February 26, 2021
Are you ready to succeed in a new financial generation?
Woo hoo! My fellow women financial advisors, our numbers are growing! According to the Certified Financial Planner Board of Standards, the number of female certified financial planners increased to an all-time high of 20,633 in 2020 – a 3% gain from 2019. There’s a feeling of change in the air for financial advisor success!
Women are rising right now in so many ways as entrepreneurs, as politicians and leaders, and as a force for equal rights. This is all great news, but we still have work to do. While the number of women in the financial services industry is growing, the rate of growth is actually slowing. Let’s look more closely at what that 3% gain represents.
A white paper produced by Millman Financial Risk Management last year states that about 23% of financial planning advisors are women. In other words, out of 10 financial advisors, eight are male and two are female. While that may seem to be not so good news, I view those numbers as a big opportunity for women in this field to make major strides in the years ahead.
I agree with most of the points made in that paper, but there are certain facets that I think are particularly important to call out, and that can be helpful in your female financial advisor career success, especially if your goal is to succeed as a financial services business owner.
Why women are a great fit for financial services advisor success
When financial services clients were asked what traits were most important when choosing a financial services advisor, the answer in this article was about much more than investment knowledge. Personalization, expertise, empathy, education, effectiveness, quality interactions, and trust came out on top.
In emotional intelligence (EI) tests, women typically score higher than men in empathy – or the ability to sense and relate to how other people view situations. Women in general also have a greater emotional capacity to recognize and appropriately respond to what others are feeling. They are more sympathetic to helping others in need.
Those traits translate seamlessly to a career that requires the sensitivity and skill to help people with a very important and highly personal need – managing and protecting their money.
Any woman who works in this industry quickly learns that effective financial advisement is about much more than the money.
In many ways, we’re therapists who have to listen carefully for both spoken and unspoken financial concerns. We have to work to build trust. Sometimes we need to be mediators when spouses can’t agree on investing, saving, or spending strategies.
How do men and women think differently about money and financial advisement?
There’s no question that women and men view money and investing differently. Fidelity Investments found that investments chosen by women outperform those chosen by men by .4%.
According to BlackRock, women save more but get more stressed about investing. When they do invest, they take a more cautious approach. And at the back of almost every woman’s mind, contrary to most men, are the “bag lady” fears – losing everything.
How do these differences and other factors impact your success as a female financial advisor? Let’s count the ways…
Financial advisor success: Why it’s your time
The financial services industry is changing quickly. Couple that with easier access to financial education and tools, a shifting distribution of wealth, and new expectations of financial services companies and clients. That creates a very different financial services advisor career climate than just a few years ago.
Almost 40% of current financial advisors are part of the Baby Boomer generation and are near or at retirement, according to a 2017 report by Cerulli Associates, creating a demand for financial advisors to fill their roles.
Women are becoming better educated about money and want female financial advisors who can relate to their specific concerns. Advisors who have struggled with similar life challenges, and who recognize the importance of financial independence. More and more women are becoming financial decision-makers.
More clients demand the specific skills that female financial advisors have to offer – the ability to build solid relationships based on trust and a willingness to empathetically listen and respond to concerns, combined with a high level of quantitative and analytical skills.
Diversity in gender and ethnicity is becoming increasingly important in companies of all types and sizes. In early 2020, Goldman Sachs announced it would not take companies public unless it had at least one “diverse” board member. Beginning in 2021, the bank would be looking for two diverse members.
More women are amassing more wealth, and they want trusted financial advisors who understand them and can help them manage it. According to a global study conducted by BCG, women controlled 32% of the world’s wealth in 2019, and are adding $5 trillion more to the global wealth pool every year, with a projected escalation of that amount in future years.
You will be part of the change for financial advisor success
If you have questioned whether you should continue to work in financial services, know that the tide is turning for women. As someone who has been working in this male-dominated industry for decades and has experienced discrimination in many ways, I feel the change and see it happening.
I am mentoring young women to succeed, and I know other female financial advisement company CEOs are, too. Men in financial services leadership roles are acknowledging and acting on the significance of this change as well. Women are not only claiming their seats at the table, they are leading discussions with clients who value their innate sensibilities and experience.
I’m convinced this new decade will mark the start of dramatic changes in the financial services industry. Women will break through and rise to their full potential. Good things are coming for women who stay the course. It’s finally time to play to your strengths and stake your place in this new landscape for financial advisor success.
Have questions about how you can succeed in your business and accelerate your journey toward reaching your goals? I invite you to learn more about ELEVATE, an exclusive group coaching program specifically designed to help female financial advisors. Start with a no-cost 30-minute consultation to discuss where you are in your career and where you want to go.
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