Let’s consider the wealthy woman. Advisors and financial providers should not make uniformed strategy decisions for female investors without knowing how today’s wealthy woman is unique.
It is with that in mind that Spectrem conducted our in-depth examination of wealthy women titled Successfully Growing Your Business with Wealthy Women.
It would be a mistake to make sweeping generalizations about female investors. However, the Spectrem study has created a comprehensive look at women from a number of demographic standpoints and asked them dozens of questions that relate to their finances, work-life balance, opinions about their wealth status and their relationship with financial advisors.
Some of the factors that influence how female investors make investment and financial decisions include work-life balance concerns, whether they are making financial decisions alone or with a spouse and whether there are children to consider. Advisors working with affluent female clients should consider how these factors might influence the investment preferences of those clients.
Career decisions by wealthy women are a major consideration, but must be approached with delicacy. According to the study, two-thirds of wealthy women have or had full-time jobs, but some worked out of economic necessity only while others worked because they wanted to. Obviously, those women who worked out of economic necessity, although wealthy, may have a different approach to investing their money than those women who worked because they wanted to and not because they had to.
The Spectrem study asks the wealthy women numerous questions about work-life balance, the long-standing issue about whether working women must necessarily ignore or push aside their duties as a mother in order to become successful in the world of career or business. According to the study, almost 80 percent of the women in the study report they are pleased with the work-life balance they maintained. However, that research is segmented again among those women who work out of personal desire rather than out of economic necessity. Knowing the different ways women in those two segments respond to the work-life balance question can benefit advisors enormously when dealing with their investment preferences.
Affluent female investors are uncertain whether their wealth will transfer to their children and allow the next generation to reach greater wealth levels. More than 40 percent say they do not believe their children will reach the same financial status as their parents did, a surprising percentage in comparison to other Spectrem research of all affluent investors.
There are profound differences in responses from the women when they are segmented by age, occupation, marital status and the number of children they have. The study also segments the women based on their advisor dependency, although a majority of these women consider themselves mostly independent of advisor services. The study also examines why wealthy women avoid financial advisors.
Finally, the study examines the choices these wealthy women are likely to make in regards to their investments. Again, whether they are old or young, married or not married, healthcare workers or attorneys can affect whether they plan to invest in mutual funds or short-term cash investments.
One of the wisest men in history, physicist Stephen Hawking, once suggested that women are “life’s most intriguing mystery’, but the Spectrem study answers many of the questions that come up about wealthy women and the factors that affect their financial and economic outlook.