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How Advisors Can Reach Wealthy Women

How Advisors Can Reach Wealthy Women

As women make strides towards equality in the workforce, many are taking over as their household’s primary income earner. Eileen O’Connor, the managing principal and co-founder of Hemington Wealth Management, says this shift presents a huge challenge and even bigger opportunity for financial advisors.

“We are doing a horrible job working with women as a whole,” O’Connor said Friday at the TD Ameritrade National LINC conference in San Diego. According to the upcoming “Women of Wealth” study,” which Hemington conducted with the Family Wealth Advisors Council, just 20 percent of wealthy women work with an advisor despite being breadwinners in two-thirds of households.

That means advisors are overlooking a deep well of assets. O’Connor said women currently control about $12 trillion, and expects that number to grow 50 percent over the next five years to $18 trillion. More women are earning degrees, and some expect 70 percent of the wealth transfer from retiring boomers to pass to daughters.

O’Connor said that there are unique challenges facing wealthy women, including the fact that many don’t feel comfortable with their status as a “breadwinner.” The cultural shift has also made wealth women navigate new roles and responsibilities, which O’Connor called “an absolute nightmare.”

For example, 50 percent of wealthy women still feel their children would be better off if they stayed home and didn’t work. Forty-three percent said they dreamed of being a mom first and having a career second when they were girls, and 28 percent said their parents disapprove of them earning the same or more than their husbands. Sixty percent of single breadwinning women felt that pursing their careers has hurt their chances of being in a committed relationship.

Many advisors simply aren’t providing wealthy women with what they need. O’Connor said only 600 breadwinning women that were using an advisor, 63 percent reported that they aren’t as knowledgeable as they would like to be and 60 percent felt their advisor was “leaving money on the table.”

 O’Connor said advisors need to restructure their discovery process to locate more wealthy women and shed their traditional gender biases that women need different plans than male clients.

“It maybe include slight different action items, and may be more of an emphasis on charitable giving or planning for higher education, but our process is tailored to who the client is. The process is exactly the same.” O’Connor said in response to an advisor’s question on the difference of planning for women.

She added that advisors need to understand the unique challenges they face and provide more contact, communication and services for female investors. Breadwinner women want advisors who take an active role as a financial quarterback that helps them understand their plans, rather than just present a plan.

The “Women of Wealth” study surveyed 1,078 women, 47 percent of who earn more than $1 million per year. O’Connor expected the complete study to be released in the second quarter of this year. 

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