Advice to advisers: Quit treating women according to traditional stereotypes | Women's Agenda

Advice to advisers: Quit treating women according to traditional stereotypes

Recently, Mark Bouris outlined his systemic approach to building the superannuation balances of Australian women.

In response, I believe Mark’s ideas point to a much larger opportunity for tailoring approaches for women when it comes to financial services.

Importantly, the wealth controlled by women is expected to grow at an average of 8% per annum through to 2014. In Australia and New Zealand, women controlled an estimated 31% of the wealth in 2009 (which was second only to the US where they controlled 33%). This growth is being fuelled by a number of factors including: women’s increased participation in the workforce; a declining gap in income between men and women; increased confidence in managing family finances; and more women inheriting wealth.

According to 2010 research by Boston Consulting Group, Level the Playing Field, upgrading the Wealth Management Experience for Women, women as wealth management clients “are both significant and undervalued”. Seventy per cent of their survey respondents (500 women with a minimum of $250,000 in bankable assets) responded that they desired a tailored approach from their advisers which understands their distinct requirements and expectations as clients.

The survey highlighted the women were not interested in targeted women’s products, but rather a more “nuanced” approach to their needs. Given the growing wealth of women, the report expects that:

  1. Women will account for a larger proportion of high net worth (HNW) clients and wealth managers need to be prepared for an upward migration of women in to the HNW segment (particularly in the emerging markets).
  2. Women will continue to become more independent when making financial decisions.

The survey also finds that women believe men get more attention when it comes to financial services, including better advice and sometimes even better terms and deals. They felt that their advisers assumed they had a lower risk tolerance (and therefore were not offered the same opportunities as their male counterparts); or were less focused on the performance of investments and more on sustainable or “green” investing (assuming that women are more attuned to “social” issues).

Indeed, survey respondents generally found that their wealth managers treated them based on stereotypes that were outdated and awkward. Some of these included assumptions that:

  1. The husband/partner makes all of the financial decisions.
  2. The husband/partner earns the greater income.
  3. Women want targeted products. (In fact the research showed they were keen for the same products and service but delivered in a more tailored way!)

Finally, the survey highlighted that women are more open to learning about investments and wealth management (regardless of their level of financial knowledge).

So how can advisers use the results of this survey to provide better services to women?

  1. Focus efforts on refining approaches that resonate with women and challenge outdated stereotypes.
  2. Consider a more holistic offering for women – taking into account all of their life cycle choices (children, family, caring responsibilities) and the impacts of these.
  3. Improve communication so it caters to the client and not the gender. With a particular focus on building trust, empathy and transparency.

What would you do differently if you were advising women?

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