Engage women investors before wealth transfers

Key takeaways

• The growing wealth of women investors creates both growth opportunities and retention risk for advisors amid the Great Wealth Transfer.
• Proactively engaging women investors before wealth transfers improves the probability of retaining assets throughout widowhood and the next generation.
• Learn strategies for building trusting relationships with women investors centered on inclusion, education and family.

As women’s wealth grows, will you seize the opportunity?

Women are building wealth as corporate leaders, business owners and skilled professionals. They control roughly one third of U.S. wealth today,¹ and over the next two decades, wives and daughters are projected to inherit $47 trillion in the Great Wealth Transfer.²

The rapidly increasing wealth of women investors creates more opportunities for advisors to serve them, which can further strengthen organic growth. Over a lifetime, women make an average of 26 referrals to their advisor, compared to 11 referrals made by men.³

However, many firms remain vulnerable to losing assets when women inherit wealth from clients who pass away. Research has shown that 80% of widowed women leave their advisor within a year of their spouse’s death, often because no meaningful relationship was established before the transition.⁴ When this happens, the advisor’s connection to the next generation of the family is usually lost.

Engaging a woman early in the client relationship significantly improves your chances of retaining assets throughout widowhood and establishing genuine multigenerational ties. The same applies in the case of divorce. The sooner you start, the more time you will have to demonstrate your value and earn her trust.

Recognize the financial priorities of women investors

Women clients have unique needs and preferences in several areas: 

• Portfolio discussions. Women investors frequently focus on goals, life outcomes and financial security over benchmarks. Frame your portfolio discussions around what the performance means for her life plans. For example, “As long as the market doesn’t fall more than 3% this year, you will be on track to purchase a second home.”
• Retirement planning. Women’s investment goals need to account for longer retirements compared to men. Their greater funding needs are typically challenged with lower earnings due to gender pay differences and employment gaps for caregiving. Discuss the impact of these factors with each of your women clients and align her investments with her unique life path.
• Investment behavior. Women tend to be disciplined investors. They are comfortable staying on track for the long run with a balanced allocation. Transparency is important to them and many prefer investments that are aligned with their personal values, which can make customizable separately managed accounts a good fit.

Include women as primary participants in client meetings

When it comes to financial conversations, women often seem like secondary attendees. This may be due to a lack of confidence in their financial knowledge or traditional beliefs about women’s involvement in the family’s finances. 

Sometimes advisors unintentionally alienate women clients by directing questions or technical explanations to their husbands, which can reinforce feelings of inferiority or offend them.

No matter the cause, it’s important that you reset the dynamic and help women feel comfortable participating in the conversation. When you meet with couples, be intentional about including the woman as a primary participant in the conversation:

• Ask each spouse to share their personal goals, concerns and definitions of financial success.
• After you share information with the couple, ask each of them individually if they have questions.
• When you present a plan or recommendation, ask each of them to share their own reactions: “What parts of this plan resonate with you, and what might you change?”
• When you ask her questions, maintain eye contact, give her space to speak and listen attentively.

These actions demonstrate that you regard her as an equal partner and you respect her ideas and opinions.

Meet one-on-one to strengthen relationships with women clients

Deepen your connections with women clients by periodically meeting one-on-one. Use your time together to review the family’s financial plan and ensure that she understands the household balance sheet, estate plan structure, beneficiary designations and long-term income strategy. Discuss what financial independence would look like if her circumstances changed unexpectedly.

Meeting in a private setting may help her open up to you, ask questions and share her concerns. A candid dialogue may give you valuable insight about potential or expected life transitions such as career changes, caregiving responsibilities, divorce or widowhood. 

One-on-one conversations help you learn more about your client and she will be able to see the value of having you as her advisor. Keep the momentum going. Conclude your first one-on-one by asking her how often she would like to meet with you going forward. 

Engage the unengaged spouse

If a client’s wife does not attend your meetings, reach out to her directly. Let her know that her input would help you better serve her family’s financial needs and ask her to meet with you one-on-one. If she declines your invitation, help her understand why it is important for her to be involved in her finances. 

Tell her about a woman in your life or a client who struggled when something unexpected happened because she had been unaware of her family’s financial circumstances. Explain that you want to ensure nothing like that happens to her.

Build trust through personalized financial education

When you help clients feel more confident, their trust in you grows. Some women find financial topics intimidating, which can be an opportunity for you to build trust by educating them on investing basics.

Never assume a woman’s level of financial knowledge. She may know very little or she may know as much as you do. Approach each topic of discussion by asking “Are you familiar with…?” This shows her that you are not making assumptions and that she can feel comfortable asking you questions without judgement.

Keep your explanations simple but not patronizing. Use plain language, not jargon. Communicating with women clients in an approachable, consultative manner can help you earn trust and long-term loyalty.

Approach recently widowed clients with empathy and patience

Approaching a recently widowed woman is a delicate situation: While you want to take action to retain her as a client, you also need to be sensitive to her loss. Empathy and patience are key. Your specific approach depends on your existing relationship with her, but there are generally appropriate guidelines for engaging widowed women:

• Give condolences promptly. If you have a close relationship with the widow, call her. It’s OK to leave a voicemail (don’t text). If you don’t have a close relationship, consider sending a card instead.
• Pay your respects in person. Attend the service or visitation. If you choose to send flowers, ask the florist to attach a personal note from you. Do not use your business card.
• Send a gift. A couple weeks after the funeral, consider sending a gift card she can use to have a meal delivered to her home. Include a personal note to let her know that you will be there to help when she feels ready.
• Give her time. Wait a few weeks and then call to ask her how she is holding up. If she seems open to talking about her finances, ask when she would like to meet with you. But if you sense she needs more time, simply remind her that you are there for her and let her know you will check on her again in a few weeks.
• Offer to meet at her home. Everyone processes grief their own way. She may not be feeling up to going out in public yet. Meeting in her own home might make it easier for her to discuss her finances with you.
• Suggest inviting a trusted person. It can be difficult to think straight or remember things while coping with a deep loss. As you discuss meeting arrangements, suggest that she ask a family member or friend to accompany her.

Connect with heirs to secure multigenerational relationships

Your chances of retaining a multigenerational relationship depend largely on the connections you forge with the client’s children before control of the assets shifts to them. Ideally, these connections begin long before either spouse passes away.

Ask your women clients if you may invite her adult children to join appropriate conversations. Explain that including her children in your meetings can help you better serve the future needs of her family. During family meetings, build trust with her adult children by demonstrating the care and stewardship you provide their mother. Advisors who focus on serving high-net-worth investors identify family meetings as the most effective strategy for intergenerational wealth transfer planning.

Additionally, offer financial education sessions and encourage your client’s children to attend in person. This creates opportunities for you to build rapport in a different setting.

Conducting family meetings is the #1 strategy for planning wealth transfers
% of high-net-worth practices identifying strategies as effective

Grow your business with women investors

The relationships you forge with women investors today can be critical for the future of your business. BlackRock can help you attract and serve women investors. Learn more about the BlackRock Business Consulting team or use our online resources.