Wealth managers urged to tap into growing market of women seeking financial advice

According to recent research by Netwealth, women are increasingly taking charge of household financial decisions, making them a key growth market for the wealth management industry.

In its Advisable Australia Report, Netwealth pointed out that while other industries, such as cars and real estate, have already taken steps to evolve their product and service design in order to attract women, wealth managers must follow suit in order to avoid missing out on this growing opportunity.

“With the expectation that over the next three to five years, women will be increasingly in charge of household financial decisions, it is important wealth managers consider and act on how they can better service women,” Netwealth pointed out.

Acknowledging that some wealth managers do specialise in servicing the needs of women, the firm found that these are niche and do not reflect the larger opportunity on offer to the whole wealth management industry.

“Developing a value proposition for women as a key market goes beyond recruiting female advisers, educating women on financial matters and product development,” Netwealth said.

“To influence substantial change requires the industry to recognise the differences and act on the opportunity,” it added.

As such, the firm noted that wealth managers must transform their businesses and client service models to attract, acquire, retain, and service women as long-term clients.

This, it however added, requires an understanding of the wealth characteristics of women and adjusting their advice offer, service proposition, and marketing accordingly.

Adviser Ratings also recently pointed out that women are under-represented in the adviser profession, making up less than a quarter of the industry. In fact, the number of women in advice has been steadily declining since 2018, which was the year the industry’s numbers peaked for all genders.

The firm also noted that this disparity in representation between men and women is not reflective of women’s performance as advisers. In fact, analysis conducted by Adviser Ratings last year revealed that female advisers had slightly higher quality scores than their male counterparts. However, despite their strong performance, female advisers have a lower number of clients and funds under management.

Ultimately, Netwealth concluded that the failure of wealth professionals to act now to capitalise on meeting the needs of this key growth market could result in missed opportunities and reduced growth potential.