Wealth Management

Part
01
of two
Part
01

Women Selecting Financial Advisors

The primary qualities that women look for in a financial advisor are the ability to listen to them, understand their concerns, explain things to them, be transparent about fees and gain their trust to build a long-term collaboration and financial plan. 93% of women do not care if the advisor is male or female. 80% of women change their financial advisors within a year of the death of their husband owing to a lack of connection with the previous advisor, who may have dealt solely with the husband or considered them as one entity. They would like to have an active involvement in their financial portfolio, and 87% of women claim that they are unable to find an advisor with whom they can connect.

BACKGROUND

As per the latest data on Saskatchewan, out of a working population of 818,850 people, 77,910 earn an income of $100,000 or more. The median total income in 2015 was 37,730. On an average, women in Saskatchewan have an average income of 1.8% more than the rest of Canada. For this research, it is assumed that women in Saskatchewan aged 35-54 years, with a household income more than $100,000 a month will have a similar mindset to other upper-middle-class women across Canada. It is also assumed that most people in this age group would have children.

GENDER DISPARITY

Women in Saskatchewan, live an average of five years longer than the men. Also, their average earnings are less than 75% of that of the men. Given this, they tend to have a more long-term approach to finances, so that they do not outlive their savings. Also, women look at financial goals as a part of their personal lives and not separate as men do. They look at savings in terms of security and safety, and a good investment plan is one that meets their life goals.

In general, women are less confident of their financial knowledge as compared to men and appreciate someone who can help them understand better. While 45% of men surveyed claimed to be "financially confident," only 27% of women did so in contrast.

CHANGING POSITION OF WOMEN

Women are growing into leadership roles in business, politics and all walks of life. 62% of women in Canada have a graduate degree. Women own 33% of all wealth in Canada. It is predicted that by 2020, 67% of financial assets will be in the hands of women. 40% of women earn more than their husbands, and 43% of Canadian investors with $500,00 or more are women. All these factors have triggered a surge in women looking for financial advisors who they can relate to and collaborate with to reach their financial goals.

HOW FINANCIAL ADVISORS FAIL WOMEN

Most women complain that they are not listened to. A lot of financial advisors come with 'templatised' solutions and are not open to listening to their female clients. There is an assumption that women are risk-averse and don't want to be involved in details of financial matters.

Financial advisers should spend time with their female clients to understand their needs.

conclusion

To wrap it up, women are less confident about financial knowledge than men, and they look for advisors who can listen to them, understand their concerns, address their doubts and work together with them to come up with long-term solutions.
Part
02
of two
Part
02

Barriers for Women Selecting Financial Advisors

The most significant barrier for women in selecting financial advisors is the advisor's ability to understand their perspective and requirement as well as the ability to build a long-term investment strategy. The reason why women leave their financial advisors is that they feel that the advisors do not listen to them, do not respect them and try to dictate what they should do. What they would prefer is a more inclusive and collaborative approach whereby they understand more about the financial landscape and can work towards a plan that suits their requirements.

BACKGROUND
The latest figures, released in 2015 state that out of 818,850 of the working population in Saskatchewan, there are 77,910 earning an income exceeding $100,000. Women in this bracket are at top 10% of the population. Since the median income for the city is $37,730, it can be deduced that those earning $100,000 and more are automatically in the upper-middle class category. For this research, it is assumed that the behavior of women aged 35-54 in urban Saskatchewan will match that of other upper middle-class women in Canada overall. Also, it is assumed in this case that most of them would be married.

GENDER DIFFERENCES
According to a survey done by CIBC, one of the leading banks in Canada, while 92% women are active in decision-making for their household finances, only 54% feel confident investing money. The way women perceive money matters is different from men. Women tend to equate money with safety and stability. Unlike men, they do not compartmentalize their finances and their personal and professional life but see it all as a whole. While men aim for bigger returns, women look for long-term gains. Another piece of research shows that women find it difficult to find financial advisors who can listen to them and understand their particular point of view. Most women leave their financial advisors because they feel that the advisors do not understand or respect them and try to dictate them on how to do business.
In Saskatchewan, the life expectancy of women is five years longer than men, which could contribute to their long-term approach towards financial management. Women also value the non-monetary aspects of life more than men do.

FINANCIAL KNOWLEDGE
Another piece of research in 2014 shows that Canadian women, in general, are less confident about finances than men. Women aged between 35-54 years old scored 61.8% in a financial quiz as opposed to men who scored an average of 65.1%. While 23.7% of the men answered all questions and only 16.3% of women did the same. In general, women feel less confident in financial matters, when compared to men. They are less likely to gamble and more stability oriented. Women are also, much more patient and do not appreciate being rushed into decisions.

EXPECTATIONS FROM A FINANCIAL ADVISOR
Women feel the need to learn more about financial management and look towards their advisor to explain the bigger picture to them. They are much more likely to seek help than their male counterparts and are looking for more information and a better understanding of financial planning. They appreciate an inclusive and collaborative approach as opposed to someone who would just dictate action items to them.

CONCLUSION

To conclude, while upper class, urban women in Canada are less confident than men when it comes to financial planning, they are more willing to seek help and are looking for an advisor who can collaborate with them to help them make better decisions.



Sources
Sources