Women and wealth

The case for a customized approach

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Around the world, women’s wealth and income are growing faster than ever. Powerful demographic, economic and technological changes are increasing women’s financial strength and independence. Recent research suggests that women may soon control the majority of US household wealth.1
 
This power, and the relative complexity of their financial lives, means that women represent a huge opportunity for the wealth management industry. Yet most wealth managers view gender segmentation as being of minor importance. It is hardly surprising that many female investors feel unwelcomed and even alienated by the investment industry.

This paper aims to help wealth managers bridge this gulf. It builds on EY’s latest global wealth management research, focused on client experiences.2  In the survey, we find a number of important differences between female and male wealth management clients. The most important include:

  • Performance: Unlike men, women view achieving their personal goals as more important than investment performance. Women are more likely than men to switch between wealth management providers, and do so for different reasons.
  • Experience: Women have distinctive preferences in many areas of client experience. These include more emphasis on security, accuracy and privacy; greater appreciation of high-quality human interactions; more openness toward digital technology; and a greater willingness to share their experiences online.
  • Trust: Women see transparency and clarity as particularly important drivers of trust. They also place more value than men on advocacy or referrals from family and friends.

To overcome “experience gaps” and build stronger relationships with female investors, we believe wealth managers should focus on seven specific areas. They are:

  1. Developing a deep understanding of female investors’ goals and priorities
  2. Understanding local and regional variations in culture, religion and lifestyle
  3. Giving advisors the skills to deliver optimal experiences to female investors
  4. Striking the right human-machine balance in core advice models for female clients
  5. Providing female investors with clear, substantive information and advice
  6. Enabling advisors to act as "financial coaches," including for clients’ families
  7. Embracing digital communication, while ensuring it complements human interaction

Our research debunks conventional wisdom about women investors. However, it also shows that many wealth managers need to do much more to connect with this vital group. Firms need to prioritize the investments in technology, talent and processes that will allow them to provide female clients with tailored experiences. 

Wealth managers must act fast and incorporate these changes into their customer experience improvement programs. Those that do so will gain the greatest share of the tens of billions of dollars in additional revenue that could accrue from providing women with better experiences.

1 “Financial concerns of women,” BMO Wealth Institute, www.bmo.com/privatebank/pdf/Q1-2015-Wealth-Institute-Report-Financial-Concerns-of-Women.pdf, accessed 21 December 2016.

2 "The experience factor: the new growth engine in wealth management," EY Global Wealth & Asset Management, www.ey.com/gl/en/industries/financial-services/asset-management/ey-global-wealth-management-survey-2016, accessed 28 November 2016.

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