Speaking in a webinar yesterday, vice president and global head of practice management at State Street Global Advisors Brie Williams said the financial advice sector needs to do away with misconceptions about female investors.
“Breaking down misconceptions around the female investor is crucial to helping women achieve their financial goals,” she said.
“Conventional wisdom says that women investors are less confident than men and that this is manifested in their investing skills. However, when you paint female investors with a broad brush like this you’re ignoring other important variables including age, education and experience.”
About 56 per cent of advisers believe they understand their female investors, yet just 39 per cent of female investors feel understood by the investment industry according to State Street’s Women and Investing Omnibus Survey 2015, which questioned 250 advisers and 1,000 female investors.
According to the report, women in the US market control roughly US$11 trillion in investable assets and are the primary or sole income earner in four out of 10 households with children.
Over the next 40 years, 70 per cent of the $41 trillion in intergenerational wealth is expected to be passed on to females, the research stated.
“Despite women exercising control over a significant amount of the nation’s investable assets, the majority of women still do not feel that the investment industry understands them,” Ms Williams said
It is an important first step to acknowledge and then do away with conventional misconceptions around the female investor.
“As an industry it seems we only have a surface level understanding of who the female investor currently is. And the way that we’re currently meeting her needs is not matching up with her significant economic impact and her growing influence in financial decision making,” Ms Williams said.
Advisers need to consider the way they communicate, coach and educate clients and the extent to which gender impacts on investing, Ms Williams said.
“Having a conversation changes the brain chemistry, moving energy to the prefrontal cortex where trust is built – which is completely different to being told something,” she said.
“True gender intelligence is about understanding how biology and socialisation influence how an individual makes a decision, how they view money and what their short and long-term goals are.
“Ultimately, the question we want to be asking ourselves if we want to be having a truly client centric approach is if gender really matters when it comes to investing?”
It is no longer my job to advise and certainly not to determine whether I should engage differently based on gender. My job is to complete a fact find, complete an SOA, implement, provide FDS and opt-in. My working week revolves around compliance and providing the same advice that every other adviser does. It’s safer that way.
Must have been a narrow sample. We find the ladies are equally happy to talk to both male and female advisers. Maybe some of us have better life/communication skills and better empathy.