Why Widows Fire 70% of Male Advisors

Over and over again you have been told about a demographic phenomenon, which concludes in several years with women controlling almost all of the available wealth assets. What you haven’t been told is how threatening this revolutionary disruption is to male financial advisors. This is no time for complacency. Read on.

Recently, my team at Wealth2k introduced, Women & Income, the first retirement income solution developed expressly for “boomer” women. Before committing to this project, we delved deeply into the research on women’s investing objectives and preferences. In this article, I will share much of what we learned.

I think it’s safe to say that the financial services business is at a crossroads. Because they represent the future of wealth management, the industry’s center of gravity must necessarily shift to women. But are we prepared to serve their needs?

Consider this question: How would you describe an industry that, in seven out of 10 instances, is rejected by its current customers?

You might say that it is unhealthy. Or in need of reinvention.  Or even destined to fail.

This is the unfortunate state of the financial advisory business, where widows choose to fire seven out of 10 male advisors following the passing of their “boomer” husbands. This is nothing less than a massive indictment of the status quo in the financial advisory industry.

Why does this happen? What are its long-term implications in the larger context of societal transformation? And what does it tell us about needed change?

Firstly, the industry needs to recruit more female financial advisors. While women represent 25% of CFPs, their share of the overall financial advisors population is just 14%. Both numbers reflect poorly on the industry. Even if aggressive recruiting efforts are undertaken, progress in attracting women into the planning field will not be nearly enough, soon enough.

For the foreseeable future, and driven by the composition of the financial advisor population, divergent investment objectives and contrasting priorities, what I call “the great mismatch” is likely to continue.

In an industry where 75% to 86% of the financial advisors are male, but where the future is all about women, it’s time for men to acknowledge that, “Maybe I don’t relate so well!”

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