Wealthy Women's Concerns for Retirement

Wealthy Women’s Concerns for Retirement

 
Women are district and potentially productive market that is underserved by financial and retirement planning advisors. Financial professionals who recognize and respond to the unique needs of wealthy women are likely to find a particularly rewarding market.
 
According to the Boston Consulting Group (BCG), women in general control 33% of North America’s wealth, approximately $9 trillion. One of the larger segments of the women’s market – mass affluent women ($100l- $1MM of net worth, not including primary residence) tend to be married and older, with an average age of 59. They are primarily concerned with having adequate resources to sustain a comfortable retirement.
 
 The majority of their assets are derived from employment income as opposed to investments, where only 9% contributes to overall total wealth. Of those fully retired, only 29% of total wealth is generated from investment income.
 
Women are more likely than men to change their financial priorities as a result of “life events.” Changes in martial status, the birth of a child, death in the family, changes in external political, economic and financial factors – all of these can shape the attitudes and behaviors of wealthy women.
 
So where do these women turn to for financial advice? Not necessarily banks or financial advisors. The mass affluent women surveyed in BCG’s study claimed to be inadequately served by them.
 
 The survey reported that 55% of affluent respondents with $250,000 or more in bankable assets said private banks need to do a better job serving female clients. They felt men received better attention, better advice and better deals and terms. Respondents also stated that many wealth managers, when dealing with couples, mostly ignored the female client and directed their attention primarily to the male, even if the women was making the financial decisions for both.
 
The survey results also revealed an impression among respondents that some wealth managers assume women have a low risk tolerance, and therefore give them fewer choices.

 In order to change this negative perception that many women hold for financial advisory roles, advisors should recognize that the lifestyles of working and retired affluent women, both married and single, require a specialized, personal approach to serving them financially. They should receive assistance in planning for a long life with special attention placed on major life events and unpleasant eventualities such as divorce, death, or the possibility of the primary wage-earner being unable to work.

 
Financial institutions that do not respond to this enormous opportunity risk missing the benefits that can be captured from serving this fast-growing mass affluent segment of the population.

Wall Street Journal citing Boston Consulting Group study, July 29, 2010.

SpectrumAdvisor. “Retirement a Concern for Wealthy Women.” Web. January 10, 2012.

SpectrumAdvisor. “Advisors Fail Affluent Women.” Web. January 10, 2012.