A Woman's View of Choosing a Financial Advisor
Our “Ask Bev” column will be back next week.
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
Can we really call 157 million American women a “niche”? Financial advisors are missing an important reality when they categorize the market that way. There are only 152 million men in this country, and no advisor would ever think of male investors as a uniform group. Ultimately, advisors who seek women clients need to realize they are marketing to individuals, not a monolithic group.
What’s more, women investors are a rapidly expanding force to be reckoned with. Especially among baby boomers, women’s purchasing power is growing at an eye-catching rate. One eye-opening statistic in particular caught my eye: “In a two-year period, the number of wealthy women in the U.S. grew 68%, while the number of men grew only 36%.” Once you reach age 85 and older, there were more than twice as many women as men.
How do advisors focus on this lucrative “niche,” but avoid offending people by assuming they all think alike?
Understanding behavioral tendencies is critical in marketing to anyone. Yes, women have some preferences that men may not, but be careful about leaping to assumptions. There was an old saying that men buy a car for the model, speed and mileage, while women focus on the color. But for the last several cars I have bought, I told the salesperson I could care less about the color; my husband was more concerned about the paint job than I was!
Yet, since we know that men and women are different in certain crucial respects, what are some safe assumptions an advisor can make about what might be more important to a woman when choosing a financial advisor?
Here are five things I’ve learned about what women seek in the marketplace:
- Relationships matter. A woman might consider how her decision will affect a family member, child, spouse, significant other or friend even when a man might not. Talking about impact on others can be very helpful to a woman in understanding the different options.