A great wealth transfer is coming as the Baby Boomer generation moves on, and women are likely to be the largest beneficiaries of passed-down wealth. Women are also continuing to build their own wealth despite gender wage discrepancies between men and women, as women continue to climb the corporate ladder in greater numbers than previous generations.
When it comes to investing and wealth management strategies, women also differ from men, which means this great wealth transfer may also lead to changes in approaches to financial planning.
Women Are Focused on Their Life Goals
When women look at financial planning, they generally are more likely to be focused on their life goals than men. With males dominating the financial planning profession, women may have a more challenging time seeking out a financial professional that will align with their planning path. Women may also be less likely to feel confident in investing without consultation, so it will be important that we are able to help them to establish trust, listen to their input, and work with them to help them with their life goals.
Risk Tolerance Differs for Women
Women can be less comfortable taking on risks compared to men when it comes to investing. This means they will likely prefer to save more depending on their financial goals. As female financial professionals, we can help plan for the additional savings required if your taste for risk stays on the conservative side. However, women may be more likely to invest at a higher risk if they feel their questions have been fully answered about the investment.
Women Are More Emotionally Influenced When it Comes to Investing
While women are pragmatic when managing their financial portfolios, they may also allow emotions to influence their financial decisions. Decisions regarding their finances may often be linked to relationships and family. To this end, women need to be able to connect emotionally with their financial professionals, which is where we come in – Flournoy Wealth Management is run by women who care about women on the journey through financial planning and retirement.
Technology Will Be Crucial During the Great Wealth Transfer
When estates are transferred, the process may be long and complicated depending on the size and complexity of the estate. If other siblings or heirs are involved, they may each receive differing advice, which may further complicate the process. It is essential that each client feels safe asking questions and comparing advice so they can come to an agreed-upon decision. Technology, such as teleconferencing and programs forecasting tax exposure, will be vital to this communication process, especially when heirs are in different geographic areas.
If you are unsure where to start or need guidance through your financial planning journey, contact our office.
Important Disclosures:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by WriterAccess.
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Footnotes:
1 Women and the Great Wealth Transfer, Investopedia, https://www.investopedia.com/financial-advisor/women-and-great-wealth-transfer/
2 The Great Wealth Transfer Will Radically Change Financial Services, Forbes, https://www.forbes.com/sites/forbesfinancecouncil/2023/03/09/the-great-wealth-transfer-will-radically-change-financial-services
