Forget the Neutrogena— women want results from advisers

Forget the Neutrogena— women want results from advisers
Investment performance trumps amenities, relationship-building, survey finds
JUN 26, 2012
For all the emphasis on the need for financial advisers to build relationships with women before gaining their trust — and business — it turns out that investment performance matters, too. “Women are like any other investors,” said Bernard Clark, head of Schwab Advisor Services. “Performance is important.” According to a new study of 500 women between 30 and 70 with average investible assets of $1.3 million, 58% percent of the respondents said that having continuous good investment performance is most important to them. About 40% said having a long-term financial plan is their top priority. Three quarters of the women in the survey, which was conducted by Koski Research Inc., indicated that they have financial advisers. A quarter of those chose the adviser themselves, while 37% made the choice together with their spouse or partner. It's no surprise that advisers and advisory firms are keen to figure out what is important to women and what they want from their financial advisers. The demographic trends have been a source of concern for the male-dominated industry for years. Women are controlling an increasing share of wealth in the United States. They are earning more educational degrees and increasing their income at a faster pace than men. And trillions of dollars of assets will pass to female baby boomers as their husbands die. Most troubling of all, scores of other surveys have shown that women aren't very happy with their advisers and that a large majority of married women switch advisers after their husband dies. So what are women looking for in an adviser? Surprisingly, the study results suggest gender is not a big issue. Nearly nine out of ten of the respondents said they have no preference for male or female advisers. In fact, more women (8%) said they prefer male advisers to female (5%). Age, on the other hand, is a bigger concern. Many women don't want youngsters handling their investments. Only 2% of survey respondents said they prefer their adviser to be under 40, while 47% said they prefer an adviser in his or her 40s or 50s. About 47% have no age preference. Women do want face time, however. Nearly 85% of respondents said face-to-face meetings are important in establishing trust with their adviser. They want to meet in the initial interview, and a high percentage of them want in-person discussions. And what do they want to talk about? Mostly, exactly what male client wants to discuss: long-term financial planning (78%), estate planning (57%), tax planning (44%) and portfolio allocation (39%). For issues concerning their account statements, market conditions or specific investments, women over 50 prefer phone conversations, while those under 50 prefer e-mail exchanges. As to the nature of the advisory relationship, women want attention to their full financial needs. They want their advisers to consider their long-term financial needs (84%), their whole financial picture (82%) and their current stage in life (70%). Forty percent said they want their adviser to consider their immediate need for return on investments, and 35% want them to consider their children's financial needs, as well. “Women, like any serious long-term investor, want advice that is intended for their specific financial situation, long-term plans for their desired lifestyle, and accountability in terms of investment performance against goals,” Mr. Clark said.

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