Forget the meek. Women are destined to inherit the earth. Don’t take my word for it. Just listen to the actuaries.
Financial professionals have probably been hearing those numbers in some fashion for several years. Don’t let them become white noise.
Why? Consider these two stats:
- American women decide where up to $15 trillion in spending goes every year.1
- 62% of women are willing to switch wealth managers compared with 44% of men.
As Dr. Joseph Coughlin says in his book, “The Longevity Economy,” the “Future is Female”.
“In the near future, the products and technologies that will make old age better will, by and large, be those that work for women,” Dr. Joe writes.
Implications for referrals
Cam Marston, a past speaker at Transamerica’s Coaching Forum, takes it a step farther. He speaks specifically about the influence of women in Generation X.
“If I’m an adviser and I’m engaging a Generation X female with young children, I must treat her very, very well, because her ability to refer people to me is enormous,” Marston said in an interview with the Journal of Financial Planning.
“If she is married with young children, she is more often than not the CFO of her household. As much as the husband may act like he is the decision-maker, when the two of them are alone, she will determine whether I get the business or not, and she still has the power to refer. So when I’m dealing with Generation X, I’m keeping a keen eye out for the influence of the Generation X female. And my prediction is the Millennial female will be exactly the same with a power of 10.”
The generation trap
Millennials are projected to surpass Baby Boomers as America’s largest generation sometime in 2019. That’s why you probably hear a lot of talk about “generational planning.” As the theory goes, if you cultivate great relationships with the children, you set yourself up for managing their inheritance assets.
That’s great, but I think financial professionals are realizing it’s equally important to nurture the relationship with the spouse. If the husband dies and the wife moves the money to a new advisor, it doesn’t matter what kind of relationship you’ve created with the next generation.
70% of widows fire their advisors after their spouse dies.
– Financial Advisor Magazine
And what about single women? The number of women who are divorced, widowed, or never married more than doubled in the past 47 years – from 29.6 million to 65.3 million, according to the U.S. Census Bureau.
There’s a movement in the industry to help financial professionals understand why they should pay more attention to women when discussing retirement strategies, but I don’t think adoption has matched the effort yet.
As a financial professional, sometimes the best thing you can do is point people in the right direction. I highly recommend the resources provided by the Women’s Institute for a Secure Retirement, better known as WISER.
When it comes to providing education for clients, WISER has just about everything you need. Fact sheets. Blog posts. Newsletters. Founded by Cindy Hounsell in 1996, WISER aims to improve the long-term financial quality of life for women. Hounsell recently received the Plan Sponsor Council of America’s Lifetime Achievement Award.
“I’ve helped scare women in America,” Hounsell joked during a phone call with our marketing department. “So when the survey people ask, ‘What’s your top fear?’ women say, ‘Retirement.’ Part of the problem is people don’t know what to do because they don’t have a financial planner. We have to educate people to do things for themselves.”
It’s the teach-a-man-to-fish theory. Just be sure to remember: Women need to know how to cast a line, too.
1 Dr. Joseph Coughlin, “The Longevity Economy,” 2017
Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, legal or financial advice or guidance. Please consult your personal independent advisors for answers to your specific questions.