What Women Want From Advisors

Blending investing and philanthropy is a common request.

Reviewed by: Manisha Thakor
Edited by: Manisha Thakor

Understanding what women really want, financially speaking, could be the secret to both industry growth and a better, healthier planet. If you are a professional in financial services and focused on the retail market, you will want to take heed.

Recently, I attended a focus group of high net worth women. More than $100 million was represented in the room. These were smart, accomplished individuals, and the intent of the meeting was to understand how their financial needs could be better met.

I had expected to hear them express a desire for more esoteric topics, such as the nuances of trust and estate planning. Instead I received a very different—and much more inspiring—message.

The message I took away was a need for two things: (1) clear, common-sense, acronym- and sales-free education about investing basics; and (2) increased clarity surrounding household cash flows, making it easier to understand exactly how much can be given away to charitable causes and/or spent to help family members.

Recipe For Client Retention

On the surface this may seem like no big deal. But dig a little deeper and you can uncover a recipe for increasing client retention, loyalty and referrals as well as a means for liberating capital to support projects that can help broader humanity.

As has been widely reported, there is an expected $41 trillion of intergenerational wealth transfer expected to occur over the next four decades.

Less widely discussed, however, is who will end up controlling those funds. According to the Center for Talent Innovation, and Andrea Turner Moffitt’s work in her recent study, “Harnessing the Power of the Purse,” roughly 70% of that will ultimately end up in the hands of women.

Men & Women Engage Differently

This only highlights the need to better understand the differences between how men and women engage their finances (or their advisor) and identify what women are ultimately looking for in financial advice.

As an example, consider new research out of the Women’s Philanthropy Institute at the Indiana University Lilly Family School of Philanthropy showing that there’s a sizable gender gap between men and women when it comes to their charitable inclinations, backing up what I have been seeing anecdotally in my work with women around the country.

The typical client portfolio review involves a lot of pie charts and statistics, often showing relative performance. I’ve found more evolved firms have graduated to comprehensive, educational slides that cover topics ranging from interest rate expectations to valuation parameters for individual security selection.

The Whys Beyond Market Performance

But what I heard loud and clear from this focus group—and in the broader work I do around women and wealth—was a desire for something more intimate and human. Women want to understand why their portfolio is invested the way it is and how much they can afford to spend or give, no matter what’s going on in the markets

I heard them say that, where possible, they’d like to consider blending those two objectives through socially responsible investing and attention to environmental, social and governance matters.

Please note, I use the term “woman” loosely, to refer to a mindset or worldview more than strict biological gender. There are men with “female” mindsets similar to the one I describe in this piece, and there are women with more “male” mindsets. Obviously, it’s dangerous to imply you can use a broad brush to describe any group of diverse humans.

The financial services industry is spending a lot of time and money trying to understand how to capture the “women’s” market. And many in the industry feel we already are being clear about our investment methodologies, portfolio strategies and financial plans. But time and again, that is not the result I am hearing from real-life, smart, high net worth women.

The advisors and firms that can close this gap and give women what they really want financially will be both long-term winners and meaningful change-makers.

Manisha Thakor, CFA, CFP, is the director of wealth strategies for women at Buckingham & The BAM Alliance.