Women live longer in retirement, and the trends are well documented. But it took a recent gathering of my extended family to bring home the reality. Six 80-something women friends and only one surviving husband were spotted at a 60th wedding anniversary party. This is the face of advanced retirement: a generation of women whose husbands handled the finances, made investment choices and addressed looming decision points. They now face these decisions alone, with the help of their adult children and/or financial advisors.
Often forced to face monumental decisions alone, they try to come up to speed and have a lot of questions. Carolyn Walder and Diana Batchelor, Principals of Lifetime Wealth Planning and Management, a $47 million Maryland-based financial advisory firm serving women, have learned the importance of partnering with women, rather than telling them what to do. “Our process educates and explains how we approach what we are trying to do. For example, we explain the two components of risk tolerance – their ability to accept risk and their willingness to accept risk – and how these two need to be in synch,” says Ms. Batchelor.
She’s a keen observer of the client’s investment temperament. “We listen to understand how they tolerate risk and find out if they open their statements. Past experience predicts how they respond to risk,” Batchelor explains.
“Woman investor” is not a monolithic term. Professional women, inheritors and married women have very different financial IQ’s and approach decision making differently. And not every advisor is suited to serving women, according to Walder and Batchelor. “Women want to be educated. Many have not taken the lead role in finances, but are thrust into it through death or a divorce,” Ms. Walder said.
Some financial advisors have it wrong by approaching women with their strong recommendations. “Women tell us how some advisors intentionally present concepts in a confusing fashion, and wave off complexity saying, ‘don’t worry about it. That’s why you are hiring us,’” Ms. Walder told us. Uh… not so much. By obscuring information in the interest of sales, these advisors create anxiety in women investors, who actually prefer more information and education so they can be partners in decision making.
Part of what drives the founders of Lifetime Wealth Planning and Management is the knowledge that this segment is the most vulnerable and could be subject to unscrupulous salesmen or advisors. Ms. Batchelor continues, “We are serving these investors in part to protect them from others.”
Advisors of either gender can successfully serve women. The veteran financial advisors offer these observations about advising women:
- Are stereotypes holding you back? “Some have to look inward and examine whether their stereotypes about women could be holding them back,” the women confided. Don’t assume she is not interested in the details or that she is not capable of understanding.
- Ask, don’t tell. “Back away from the ‘you-should, you-need-to, you-have-to’ kind of language.” When you adapt a more inquiring approach, you might try ‘what do you think about this?’ and ‘tell me about…’.
- Don’t be all business. Relationships are very important to women. Be sure to ask about what they are doing. Lifetime Wealth offers a warm, inviting, soft office environment, and the advisors never jump right into business without demonstrating their care for their client’s well-being.
- Get ready for gratitude. The women enjoy enormous gratification from serving women investors. “When you help an 80-year old widow figure out her finances, it’s very gratifying,”Ms. Walder said.
Quoting Winston Churchill, she summed it up: “We make a living by what we get. We make a life by what we give.”