Executive summary:
- In support of International Women’s Day, we consider the theme of #InspireInclusion which encourages us to collectively support opportunities for women.
- Learn how to engage and tailor approaches for women, addressing unique challenges and priorities in financial planning.
- Discover insights and resources to actively support female clients, seize opportunities, and shape the future of wealth management for women.
My parents were never the kind of people to think they needed to work with a financial advisor. They had their checking and savings account, their 401(k)s and pensions. What else did they need? It wasn't until my mom passed away in 2020 that my dad fully understood the importance of taking control of his finances and having a professional build a plan to help get him to and through retirement. Because my husband and I both work in the financial industry, we were lucky enough to have a network of people to get him pointed in the right direction. Or so we thought. But something interesting happened. The financial planner we had found for him had no interest in bringing me (my dad's power of attorney) or my sister into the conversation. Instead, he offered for my husband to join the meeting.
Thankfully, my father saw the writing on the wall. This was not the advisor to help him build the financial plan he was looking for. But it got me thinking about my mom. Would she have experienced the same lack of consideration from the advisor? Is that a common practice from financial advisors for their married clients?
Building client relationships: Tailoring approaches for women in their financial journey
It's easy to see why women become so disenfranchised with financial advisors that are working with their husbands and why they view the investment industry as a male-oriented and unwelcoming world. We know that women tend to live longer than men, on average of five to six years. And once a husband passes, 70% of women will actually change their financial advisors within one year.1 This has the potential to be significant to an advisor’s practice if they are not currently engaging the spouse.
A few important questions to ask yourself. “What is my client discovery and re-discovery process for engaging women?” “Have I put intention and an emphasis on this in my business? Especially if my book is made up predominantly of older clients in that baby-boomer age demographic?” “What is important to women when it comes to their finances?”
At the end of the day, we want to help women get involved and feel engaged with their financial security. It’s important to help them feel encouraged, empowered and welcome. What we’ve found is that women exhibit a lesser concern for performance metrics compared to men; instead, they perceive investing and money as more than just the bottom line. For women, money serves to finance the life they aspire to lead, with a heightened focus on achieving real-life goals rather than simply outperforming benchmarks.
What strategies can you employ to empower women as active engaged investors, guiding them towards a secure and comfortable financial future?
- Engage in more meaningful discovery. When was the last time you refined the way you gather information on your clients? Conducting a thorough discovery, or revisiting it for existing clients, is key to helping investors identify their priorities or challenges in planning for retirement. It is also a great way to include disengaged spouses, often the female member in traditional couples, who may show less interest in the investment strategies but do value planning for their futures.
- Tailor your approach. While some clients might want fancy charts and investment graphs, most just want reassurance that they are going to be okay when they retire. Think about demonstrating how they are invested for outcomes versus invested for performance.
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Empower informed decision-making with resources. Provide workshops, resources and tools that simplify investing and financial planning. Emphasize long-term financial wellness, retirement planning, and the role of investments in achieving favorable outcomes. At Russell Investments, we see the value that you bring to your clients’ financial wellbeing. We are happy to be a partner that can help you with these strategies. Reach out to your regional team for access to our Women & Investing materials.
3 ways your Russell Investments team can help:
- Women Wired to Invest: Partner with your Russell Investments regional team to access insights on effectively supporting female clients. Collaborate in hosting special events featuring Russell Investments experts, showcasing strategies to empower women to unlock their financial power and taking control of their future.
- Deep discovery: Engage your female clients and prospects through a deep discovery process designed to unveil their true priorities. This strategic approach ensures a comprehensive understanding of their financial goals, fostering a more tailored and potentially impactful advisory relationship.
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Get organized checklist: Empower your female clients with a practical checklist designed to bring organization to key aspects shaping their financial future. This tool serves as a valuable resource in guiding them through essential considerations, enabling a proactive and informed approach to financial planning.
The bottom line
You might be surprised to learn that women in the U.S. gained the right to open their bank accounts without spousal permission just 50 years ago.2 Despite advancements, a recent survey indicates that, even as more women now manage household finances, a significant percentage of them have never sought guidance from a financial professional.3
As we stand at the threshold of the largest generational wealth transfer in history, with women projected to control a substantial portion of the $30 trillion in baby boomer assets by 2030, the financial landscape is undergoing a transformative shift.4 This presents a golden opportunity for financial professionals to play a pivotal role in guiding and supporting women on their financial journeys. Now is your time to seize this opportunity to empower and help shape the future of wealth management for women.
Disclosures
These views are subject to change at any time based upon market or other conditions and are current as of the date at the top of the page. The information, analysis, and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual or entity.
This material is not an offer, solicitation or recommendation to purchase any security.
Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.
Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional.
Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns.
Frank Russell Company is the owner of the Russell trademarks contained in this material and all trademark rights related to the Russell trademarks, which the members of the Russell Investments group of companies are permitted to use under license from Frank Russell Company. The members of the Russell Investments group of companies are not affiliated in any manner with Frank Russell Company or any entity operating under the "FTSE RUSSELL" brand.
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