Key takeaways:
- Women represent a large and growing opportunity for financial advisors
- But advisors need to understand that their circumstances, goals, and the way they invest can be quite different from men
- Women can be great clients as they are generally less impulsive and more likely to provide referrals
My friend recently broke up with her boyfriend and immediately changed mechanics. What does one have to do with the other? Well, every time she took her car in for repair, the mechanic would only speak to her boyfriend even though my friend drove up to the garage, was holding the keys, and was the one to pay the bill.
Therefore, when one relationship ended, so did the other. The mechanic had never paid any attention to her anyway, she told me. She found a new mechanic who listened to her concerns and took the time to explain his diagnosis. She has now recommended him to a number of her friends.
There’s a lesson for financial advisors in this story. If you demonstrate a genuine intention to engage and connect with your female clients, it will build relationships that could drive the growth of the business for years to come.
Are you missing out on a big opportunity?
Women are a significant and growing economic force and represent a huge opportunity for advisors who understand their unique needs, circumstances and goals. With International Women’s Day coming up on Saturday, March 8, it’s a great time to examine how women invest and why catering to this demographic may help boost your advisory business.
According to the Bank of America Institute, women control 33% of wealth globally, a percentage that is expected to increase substantially over time due to legal reforms, rising education levels and other factors. In Canada, more women than men are getting university degrees and the number of women on corporate boards has nearly doubled in the last 10 years.2 By 2028, women are expected to control C$4 trillion in wealth in the country. And then there is the Great Wealth Transfer as Baby Boomers pass on their wealth to those left behind. C$1 trillion is expected to change hands by 2026.3
Source 1: Most advisors overestimate ability to serve retirement needs of female clients, InvestmentNews (Mar 2024)
Source 2: Women as the next wave of growth in US wealth management, McKinsey & Company, July 29 2020
Source 3, 4: Why Women Leave their Advisors, Rethinking65 (Jan 2023)
Advisors who ignore women do so at their peril. Like my friend who dropped her mechanic when she parted ways with her boyfriend, women are prone to switching financial advisors when they lose their husbands, either through death or divorce. With 40% of women widowed after the age of 65 and “grey” divorce exploding, that could lead to a tsunami of women searching for a new advisor.
Women are a different kind of investor
Could that be you? Do you understand the challenges that your female clients face compared to men?
First, there’s the long-standing pay gap which is even more pronounced among minority women. That leaves women with smaller retirement nest eggs and fewer retirement benefits. Additionally, as leading providers of childcare and elder care, women are more likely to take career breaks or have multi-phase careers as they try to reconcile their professional goals with their caring commitments. That also reduces their capacity to save. Women also head the majority of single-parent households. And women on average live longer than men, meaning the savings they do have need to stretch for a longer timeline.
Despite these challenges, women are becoming an economic force in their own right, as I noted earlier. Whether women earn it, marry it, inherit it, or outlive it, the bottom line is that 9 out of 10 women will be solely responsible for their finances at some point in their lives.2
So ... women need financial advice that caters to their unique circumstances. They also need financial advisors who understand their wants and the way they invest, which is often markedly different from men.
And just like my friend recommending her mechanic when she found one that served her needs, women can be a great source of growth for an advisor’s business because of their higher propensity to refer you, when they are happy and engaged. In fact, research has found that women make 26 referrals to their financial adviser on average, compared with 11 by the typical male client over their lifetime.3
The bottom line
The combination of women being naturally wired to invest, and willing to work with advisors who genuinely understand their priorities and concerns, can make a partnership for women a win-win for both you and for the women you serve. In the years ahead, women are on a trajectory to control the majority of the wealth in the country. Failing to engage this demographic increases risk to the sustainability of any advisor practice.
Like my friend's former mechanic, are you prepared to potentially lose female clients by incorrectly assuming they are happy with the experience and services you and your team are providing?
Or, is this the year you seize the opportunity to build long-lasting relationships and intentionally engage your female clients—who may just become your best source of referrals for years to come?
1 Source : Percent of adults 25-64 years old in Canada that have a tertiary education in 2021, by age group and sex (Statista.com published Jan 2025)
2 Source: Unfinished business: A decade of data on women in Canadian corporate leadership (BLG.com Jan 2025)
3 Source: The Jackpot Generation, (Macleans.ca Sept 2024)
4 Source: https://www.cnbc.com/2019/05/30/heres-how-women-can-become-financially-independent.html
5 https://www.investmentnews.com/female-clients-more-likely-than-men-to-make-referrals-43802
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