When Patty Bloomer’s husband fell ill with cancer, she took control of the finances that they had
managed together for decades. But before she could make any investment
decisions, she first had to educate the conservative banker the couple then used
about their working relationship.
 Bloomer, of Binghamton, N.Y., recalls receiving a letter from
her banker telling her how he planned to manage her assets. As a person who came
of age when societal mores encouraged women to defer to men regarding financial
matters, Bloomer, a member of the local Junior League, had long confronted
sexism of this sort. She picked up the phone and told the banker that she was
not going to follow his plan. Then she gave him some orders of her own. She
wanted to meet with her banker and her husband to discuss what to do with their
investments—and that is exactly what happened.
"Bankers always felt that they could manage your money for you,
and you had very little say," Bloomer recalls. "Over the years, I have made it
very clear to them that they invest the money, but they and I are the ones who
make the decisions."
Bloomer’s experience reflects two growing trends: the
increasing importance of affluent women as a client base for advisors and
financial institutions, and the need for fresh approaches by financial
professionals who work with these women. Between 1996 and 1998, the number of
affluent women—with investable assets of at least $3 million—in the U.S.
increased by 68 percent, compared with a 36 percent increase in the number of
wealthy men, according to the study Women of Wealth by Russ Alan Prince
and Hannah Shaw Grove. The report surveyed 743 women who had a combined $4.85
billion in net assets and a combined net worth of $17.81 billion; it was cited
in a presentation by Lisa Gray, CEO of Graymatter Strategies, which assists
advisors serving affluent individuals and families.
TOP VIEW Demographic shifts are creating a growing number of affluent women, and the financial services industry is rushing
to serve them. Some advisors offer these women little more than patronizing platitudes,
while others pitch programs that range from financial spas to seminars focused
on wealth and happiness. The
most suc-cessful relationships, however, seem to develop when these women become well educated on the issues surrounding investing, wealth transference and philanthropy. |
The number of women who own large portfolios will only grow as
the baby boomer population ages. Over the next decade, more than 7 million
entrepreneurs will liquidate their businesses, representing more than $10
trillion in wealth, according to data cited by Elizabeth Bloomer Nesvold,
Bloomer’s daughter and a managing director and partner of New York–based
Cambridge International Partners, a mergers and acquisitions advisory firm
specializing in financial services. About half of these business owners will be
women—many of whom will hold large amounts of cash for the first time in their
lives. Given that men typically die at an earlier age, many more women will be
left to manage their family’s wealth after their husbands pass. "The dynamic is
changing. Not only are we going to see more women in control, but women live a
lot longer," Nesvold says. "There is going to be a need to understand their
issues—in the context of executives who have very busy lives and women in
transition, let’s say, widows."
Group Dynamics
Focusing on women as a group does not suggest that they need
different financial information than men. Prosperous women and the advisors who
have built successful relationships with them are leery of sweeping
generalizations that overlook the diversity of experience and the knowledge—that
many women bring to financial discussions today.
But some common themes are emerging. While women require the
same type of in-depth financial data that men do, many women prefer a different
kind of communication style. This encompasses all phases of the process, from
the marketing pitch to the working relationship. When selecting an advisor,
women often emphasize building a long-term partnership; men tend to focus more
on new trends in investing that an advisor might introduce. Many men tend to
view increasing their wealth as an end in itself, while women often perceive
their funds in a broader context—as a means to be independent, care for children
or make philanthropic gifts, for example. Lastly, while men and women both want
details on portfolio performance, many women go a step further and take an
interest in the thought process behind an advisor’s investment choice. "I like a
company that provides education," says Sandra Haslinger of Akron, Ohio. "They
sit down with you and explain what they’re doing, what it’s all about; they have
recommended reading and have someone in the company who writes about the
philosophies."
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