A historic opportunity awaits financial advisors as many women are poised to become “double inheritors” of the more than $100 trillion that is expected to be transferred from baby boomers and older generations by 2048.
That’s according to new research from Capital Group that indicates financial advisors should work empower more women to invest. The investment management firm said in a news release that by encouraging more women to seek financial advice and begin investing, financial advisors will also be growing their practices.
Although women control over $10 trillion in household financial assets, they are almost 40% more likely to start investing after age 35 compared to men. Capital Group conducted a survey of 814 women with investment accounts. Among its findings were the main barriers to women investing, which include:
26% of women say don’t have enough saved to work with a financial advisor.
One in three women say their financial situations are complex and stressful.
Women are less likely to seek financial help after major life events, such as marriage, despite being more open to advice than men.
“Our research shows that financial advisors can bridge the investing gap between women and men by changing how they market to, and communicate with women, many of whom are hesitant to seek advice,” Wassan Kasey, Senior Vice President, Advisor Practice Management Consultant, Capital Group, said in a news release. “Marketing online and through a woman’s social networks, appealing to her financial aspirations, and clearly communicating the value of your advice versus its cost can help overcome this hesitancy. By helping women seize the opportunities provided by the Great Wealth Transfer, advisors can also grow their own businesses.”
Capital Group’s research shows financial advisors can take four steps to engage more:
Increase and target online marketing to women, who rely first on search engines when shopping for an advisor.
Emphasize the value and cost of your professional financial services and simplify onboarding.
Appeal to a potential female client’s aspirations – such as financial freedom – instead of life events like marriage or raising a family.
Lead with questions rather than directives and categorize women’s communication preferences – such as prioritizing phone calls for check-ins.
Advisors who simplify onboarding, tailor communications to each women investor and emphasize mental and financial well-being can help female clients build confidence and increase their participation in their financial futures through investing.
“This opportunity underscores the significant potential within the female investor demographic for financial advisors looking to increase client acquisitions and grow their practices,” Capital Group said in the release.
The survey
Capital Group partnered with Kantar for the online survey of 1,504 U.S. consumers (including 814 women) from Oct. 22 through Nov. 5. Survey participants were between 22 and 78 years old, with some influence in financial decision making for their household and one investment account. Participants also had to meet a minimum level, which varied by age) for household income or investible assets.
