To honor Women’s History Month, in this month’s Patent Perspectives column with Pat Hynes, President of Prudential Advisors, we asked for his perspective on the wealth management industry’s ongoing efforts to support and advance women advisors — and why that’s critical for the long-term health of the industry.
WSR: It seems as if the financial services industry has been focused on increasing the number of women advisors for decades. Has it moved the needle?
Hynes: Women are well represented in general across finance, and in essential functions such as human resources, marketing, legal and compliance. But despite sincere efforts, the advice business hasn’t seen similar results when it comes to female representation among financial advisors.
According to LPL Financial, the percentage of female certified financial planners in 2013 was 23%. By 2023, that number had only inched up to 24%. So, the reality is more needs to be done across our industry to support women pursuing long-term careers in advice and help them thrive and grow.
WSR: Women control a greater percentage of assets than ever before. How is that being impacted by the Great Wealth Transfer?
Hynes: According the McKinsey, women may control as much as 45% of all investable assets in the U.S. and Europe by 2030.
That’s an incredibly significant number. And it’s being driven by interrelated social, economic, demographic and cultural trends. Much of it will be due to the estimated $124 trillion transfer of wealth from baby boomers to widows and younger generations, but it also continues the trend we’ve seen of women taking a larger role in family finances, becoming more financially independent and gaining confidence in money matters.
Today, women are increasingly the ones earning, inheriting and directing family wealth.
Today, women are increasingly the ones earning, inheriting and directing family wealth. And that shows no signs of slowing. Wealth management firms and advisors who understand this reality will be the ones who thrive in the future.
WSR: How can firms better serve women?
Hynes: With the growing financial importance of women in society, firms need to better equip all of their advisors with coaching and tools to more effectively serve the unique needs and priorities of female clients. At the same time, firms need to ensure their women advisors have the support and opportunities required to build and grow successful practices.
Supporting the advancement of women advisors isn’t just the right thing to do, it’s also an important avenue for a firm’s near- and long-term organic growth.
Female consumers often cite empathy among the top qualities they look for in an advisor. Clients often want to work with someone who has lived a shared experience, and women are no different. So, it’s no surprise that studies have shown that many women prefer working with female financial advisors.
Lauren Gilbert of Wealthwise Financial Services writes in Forbes that female advisors often demonstrate strong listening skills, put the client at the center of discussions and prioritize the client’s unique needs over any agenda the advisor might have. These attributes — when embraced by advisors of any background — are essential to building trust, fostering long-term relationships and creating a truly holistic plan that puts the client and his or her life goals at the forefront. Simply put, these are the types of advisors the industry continues to need.
WSR: What can firms do to support the advancement of women financial advisors?
Hynes: The CFP Board’s recent report, “Advancing Women in Financial Planning,” finds that increasing women’s representation and success in financial planning requires continued focus on mentorship, leadership development and flexible workplaces.
Research shows that many women prioritize passion and energy in their work, along with financial and job security and a better work-life balance. A career in financial planning can deliver on these goals by offering stability, flexibility and the chance to improve people’s lives. In fact, job satisfaction among women CFP professionals is at 93%, compared with 77% of women in other financial services roles.
Firms can foster supportive environments for women by emphasizing teamwork, collaboration and mutual support.
Firms can foster supportive environments for women by emphasizing teamwork, collaboration and mutual support. Teaming promotes both personal and professional growth for women, allowing them to expand their knowledge base, gain new expertise and develop leadership skills.
Women advisors should also have access to resources such as mentorship, professional development, technology, personal insurance and administrative support to help them build and scale their practices. Increased access to these resources can strengthen community, accelerate professional advancement and improve long-term retention.
Women advisors, and the wealth management industry as a whole, benefit when they have the support and opportunities needed to succeed.
James Miller, Contributing Editor and Research Analyst at Wealth Solutions Report, can be reached at ContributingEd@wealthsolutionsreport.com.
