Study Finds Women’s Needs Often Ignored By Financial Advisors

By Cyril Tuohy

InsuranceNewsNet

If women don’t believe that financial advisors are meeting their needs, perhaps there’s a good reason. Most financial advisors are men, and men often find themselves — either by accident or by design — talking to other men.

Men like to talk about total return, about individual stocks and bonds, about tweaking portfolios, about asset allocation, about money. And, yes, most men like to talk about women.

Women like to talk about lifestyles, about family needs, about communication, about financial control, about feeling included. And yes, most women like to talk about men.

The approach men take to financial advising isn’t necessarily better than a woman’s approach, said Karen Roberts, past president of Women in Financial Services. They are just different. But with more women than ever making financial decisions in the family, then perhaps it’s time women sit down with a same-sex financial advisor … but can they find one?

“Women talking to women — we need more women in the business, and the way to do that is to allow the business model to change because women do business differently than men,” Roberts, a financial advisor in the Tampa, Fla., offices of boutique broker-dealer J.W. Cole Financial Inc., said in an interview with InsuranceNewsNet.

Compared with accounting-related professions, it’s slim pickings for women in financial services distribution.

The U.S. Department of Labor statistics list 369,800 personal financial advisors employed in the U.S. in 2010, and 30.8 percent of them were women. By comparison, there were 1.64 million accountants and auditors in 2010, and 60.1 percent were women.

Women have made inroads in financial services, but the progress has been painfully slow and has lagged behind accounting, said Roberts. In legal professions, 48.8 percent of employees are women, according to government statistics, though many are in back office and support functions.

The latest findings on how women relate to their financial advisers are contained in the 2013 Women, Money & Power Study, released by Allianz Life. The study found that 69 percent of women do not see their financial professionals as a “go to” source for information about how to save, spend and invest.

Only 38 percent of women noted they had a financial professional, the survey also found, and of those with a financial professional, 38 percent said their professional is “not very responsive,” and 40 percent said the financial professional “doesn’t seem all that interested in my personal situation.”

Even when advisors respond, their ability to effectively communicate with women seems to fall flat as 68 percent of the respondents felt financial planning materials are boring. In addition, the survey found 54 percent of respondents said financial material “seems like it’s in a foreign language,” and 40 percent said that none of the information is “applicable or useful.”

Katie Libbe, Allianz Life vice president of Consumer Insights, said the industry hasn’t learned much over the past seven years about “customizing solutions to female clients.”

“Women are in more financial control than ever before, and regardless of their high level of interest in learning about financial topics, the information and planning resources made available aren’t doing enough to change negative perceptions about the industry,” she said in a statement.

“We have to teach men that women are important,” Roberts said. “When you have the meeting with the husband and wife, it can’t be just with the husband anymore. The woman has to be included. The old fashioned way of doing business has to end, and it’s time to find new ways to get women as involved as the man.”

The sales model espoused by financial advisors and developed by men has been built around numbers instead of relationships. Men, trained to follow an “activity-based” model, want to know how many meetings they can hold.

Women prefer developing clients through networking and luncheons, and are less concerned with plowing through the numbers. “We have not as much activity, but the activity we have is a stronger relationship, and we keep that client for life,” Roberts said.

The 2013 study was conducted with more than 2,000 women ages 25-75 with a minimum household income of $30,000 per year.

Cyril Tuohy is a writer living in Pennsylvania. He has covered the financial services industry for more than 15 years. He has also written about food, restaurants and travel. He can be reached at [email protected].

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Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].