With women expected to receive a hefty wealth transfer over the next three decades, advisers hoping for a piece of that wealth must learn how to attract and retain more female clients.
THE FINANCIAL advice industry is staring at a big problem.
Over the next 30 years, women are set to be the main beneficiaries of a $2.4 trillion wealth transfer from baby boomers and Generation X, according to the ING Direct Women & Finance report.
But many advisers will never reach them unless they learn how to cater to female clients, said ING Direct’s executive director for distribution, Lisa Claes.
“Our research shows that women play a key role in finances in both the long and short term, but their approach to seeking advice and investing differs to men,” she says.
“We are at the threshold of a time when women will be increasingly taking on more financial decision-making while assuming custodianship of a significant inheritance, supplemented by the vast wealth they have already earned, invested and amassed.
“The challenge now is for financial advisers to capture this opportunity.”
Beyond reaching into an untapped market, advisers can help women reach better financial security if they learn how to attract them. According to recent research by ANZ into gender-based financial inequality, women on average earn $700,000 less than men and retire with around half of the superannuation.
AMP financial adviser and managing director of Jade Financial Group, Dianne Charman, believes this is an important issue that advisers must tackle.
“One of the key issues is that women don’t have enough in their retirement savings, they have a different work life, and I would just really encourage advisers to try and contact women as early as possible,” she says.
However, reaching and retaining more female clients is easier said than done, and that is because many are not getting the service they need or want. Advisers who are hoping for their slice of women’s growing pool of finances must change the way they communicate with female clients.
Speak their language
One of the most significant ways in which Ms Charman was able to bring more female clients into her practice was by getting involved in local women’s groups, where she offers information and support. For male advisers, who may not be able to join some of these groups, she recommends supporting them at events and such.
However, it is important to be “genuinely interested” in what those groups are trying to achieve, Mr Charman adds.
“If you really want to work with women, the best way is to understand what their issues are. And if you’re aligned to some of those issues, then there’s a good match,” she says.
“As soon as you’re disingenuous about it, it’s not going to work.”
In addition to finding mutual interests, advisers should strive to form strong relationships with their female clients – a tactic Ms Charman believes can add value to the service.
“It’s not so much the small talk but really understanding [the client],” she says.
“Women like the acknowledgment of ‘Oh gosh, how’s your day been going?’ They don’t want to solve anything. They just want you to listen. That’s one of the key things – we just like a little bit of acknowledgement.”
Lisa Duggan would agree. The financial planner and owner of Victoria-based Epona Financial Guidance says she has become a kind of counsellor for many of her female clients, although she does not recommend the strategy for all advisers.
“To be able to have conversations that are so personal and so important to someone’s life, that’s hugely rewarding,” she says.
“[However,] I don’t think it’s for everyone. It’s going to come more naturally to some than others. But I think you can add the most value by doing that counselling role.”
Teach them a lesson
In addition to firing up the conversations, Ms Charman has found that teaching her female clients ‘the ins and outs’ of the financial system has paid off in the long run.
When she observed that many of her female clients wanted to be financially literate, Ms Charman began hosting regular educational workshops.
“What I find with women is that they’re quite hesitant when they don’t know – and that can be a little bit overwhelming,” Ms Charman says.
“Women like to know everything before they actually make a decision. They like to be informed. So that’s what those sorts of workshops can do.”
At the workshops, Ms Charman breaks down certain key concepts – such as types of insurance – and talks about why they are important. She also teaches her clients about superannuation statements, including how to read them and what they should be looking for.
“I do a bit of a ‘MythBusters’ approach on the industry jargon, what the ASX is, and why do we care. I help with those sorts of things to help them understand,” she says.
However, running workshops may not be convenient for everyone, so an alternative would be to use social media, Ms Charman says, noting that the attention she receives on her company’s Facebook page is largely from women.
“Don’t underestimate social media,” she stresses. “We’re really conscious about doing things on there that are helpful for people. So we don’t just say ‘Come and see Dianne’. We say, ‘This is some information I’d like to share with you. If you’ve got any questions, please ask’.
“I think women really respond to that because it shows you want to make sure they’re informed and they’ve got education. Take your time and make sure you invest in that with them and they will be your clients forever.”
And while both men and women want to be educated, men are typically confident about what they know, and at times, women are not.
“Men like to be as engaged as women do. I think the difference for me when working with men as opposed to women is that women are going to take a little bit more time,” Ms Charman says.
“Whereas some of my male clients will go ‘Yep, I’m fine with that.’ Men tend to be more risk takers and women tend not to be as aggressive with that risk taking.”
Female advisers get it
Perhaps the best way to reach out to more female clients would be to work alongside more female advisers, says ING Direct’s Ms Claes.
“Your organisation needs to reflect your customer, so if more women are seeking financial advice then yes, we need to have more women,” she says.
Santi Burridge would agree. The chief executive of corporate development for Implemented Portfolios believes there is a massive shift toward objectives-based advice taking place, and that women advisers are best-placed to offer it.
He says there is a broad trend in the US at the moment which is taking people through the “emotional journey” of financial advice.
“Paradoxically,” Mr Burridge adds, “the advisers that are best at [delivering objectives-based advice] are women.”
Meanwhile, Andrew Peters, managing director of Melbourne-based Semaphore Private, says he has had several clients actually ask for a female adviser.
“They’ve actually said that they don’t want me involved,” he says.
Mr Peters, who works with two other female advisers at his practice, says his colleagues bring a “slightly different skill set” to the business.
“They’re great listeners. They work really well together in teams,” he says.
“I’ve worked in all-male teams before where things can get a little bit competitive between each other and people may not help each other out as much as they should. So there are a whole lot of synergies.”
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