"If you had any doubt about the market opportunity, 60% of wealth in UK will be in the hands of women by 2025."
Historically, in any global crisis or recession, its women who are hit the hardest. So, with the biggest global emergency in generations, what does this mean for women and their financial security and what does it mean for us as advisers to those women? Is this a market worth focusing on?
Women’s roles have shifted dramatically over the past 100 years but sadly they are still years behind when it comes to financial independence. Research from Kantar, “Winning Over Women”, found that women tend to be more engaged with everyday banking and insurance whereas long term investments and pensions remain a man’s world. If you had any doubt about the market opportunity, 60% of wealth in UK will be in the hands of women by 2025, however 70% of women lack financial confidence and lose nearly £1m across their lifetime as a result and are still so under invested. Apart from confidence, there also remains an engagement gap which investment providers will need to address before we see meaningful change. If investment providers were able to engage more meaningfully with women, increasing their level of financial engagement and confidence, the results could generate a further £12.4bn from millennial women and £24.4bn from Gen X women.
The ability to be financially independent is a core aspiration for the majority of women interviewed in recent Kantar research, regardless of background or age. In a climate of uncertainty, this presents a strong opportunity for advisers to be a guide, provide some order and stability in the chaos. Whilst many financial services firms have got better at acknowledging women as customers, the research with female clients demonstrates there is some way to go to build trust and engagement.
As a female founder of a financial advisory business, and founding partner of the WealthiHer Network which aims to drive the economic advancement of women globally to empower and equip them with the support and knowledge to prosper, I am passionate about creating an environment of equality of advice for all and in particular women. New business growth during lockdown has been strong from women and we put this success down to ensuring we have a strong brand narrative that appeals to women and focusing on meaningful relationships rather than transactional relationships. Knowledge is vital, women at all levels of success or source of wealth want to be guided and feel comfortable to ask seemingly simple questions.
This environment has certainly re-enforced the necessity for and value of good financial advice, both from existing and prospective clients. In terms of the importance of money for women, high on the list is security, comfort and providing for the family for today and the future. As a result, lockdown has seen a greater focus on financial planning, budgeting and an increase in financial health checks.
There are real opportunities to build this engagement and trust, starting with urging women to consider reviewing what they have in terms of pension savings; I advise many women who don’t even realise the value of what they have sitting around in old frozen schemes and how that might be able to work harder for them. The magic of compounding means that starting early, either saving for a pension or an emergency cash fund, can make a real difference to their future financial security. Security and family features high on important planning issues for women. Protection solutions are worth considering; there is no point putting in great plans for the future if you are not going to be there or you are diagnosed with a critical illness.
The market opportunity to advise women is real and it is strong. In my view, the following five simple aspects lead to successful outcomes in engaging with and winning over women and their financial planning needs: openness, education, a personalised service, access to networks and finally, more female advisers in our industry.