The winds of change are blowing in the right direction in the insurance and financial services industry. In what has historically been a male-dominated industry, we are now seeing increasingly larger numbers of successful women financial advisors. And many of these women are innovative leaders and pace setters in the field.
While this is fantastic news, our industry is far from reaching the mountaintop in terms of female representation. Even with recent progress, women represent only 14% of the total advisor and broker head count in the United States, although about 28% of rookie advisors are women.1 Additionally, only 23% of Certified Financial Planners are women, a figure that hasn’t changed in at least a decade.2
Clearly, there’s still plenty of upside and opportunity for our industry – and your agency as well. An increasing number of forward-thinking leaders are recognizing the business case for making an intentional and immediate effort to hire more women for their agencies.
Here are five reasons for you to ramp up your agency’s female recruiting efforts sooner rather than later:
1. Purchasing power and changing demographics
Women control an estimated $14 trillion in assets, representing more than 50% of all private wealth. They control 85% of all purchases and launch 70% of all new businesses.3 Additionally, nearly 60% of all college graduates are female. And nearly 30% of homeowners are single women.4
The women’s market is a market worth pursuing. Diversifying your advisor team better equips your firm to meet the needs of a changing demographic.
2. Women have “inside knowledge” that can help to grow your business
There are all sorts of viewpoints on whether women prefer to do business with women or whether it’s an advantage for female advisors when selling to female clients. However, there seems to be no definitive, data-based answer either way.
That said, most can agree on this: Women advisors have inside knowledge about women. They’re more likely to understand and relate to any other differences in priorities and decision-making processes that may exist across the genders.
This insight will not only facilitate connections between female advisors and clients, but it can also help male advisors become better at selling to women. Through observation, office conversation and “osmosis,” male advisors who work side-by-side with women advisors will learn how to better connect and do business with female clients. It’s inevitable. Shared knowledge and education are powerful.
3. More female advisors often means better client retention
No question. Referrals and new business are super-important for your business. That said, the lifeblood of your business over the long term is client satisfaction and retention. A number of studies suggest that diverse advisor teams, particularly those with women, perform better in terms of client satisfaction and longevity of client relationships.5
4. Women can enhance your agency’s winning culture
Female advisors are more likely to know other women in the industry, so increased referrals are an obvious benefit of recruiting women. However, there’s a deeper, more important benefit for your firm. Female advisors can influence the culture of your business in a positive way.
Contrary to popular belief, increasing the number of female advisors is not about “quantity” as much as it’s about authenticity and inclusion. By giving more women a seat at the table, your agency can uncover ways to ensure that financial professionals of diverse backgrounds are empowered to succeed. This kind of good news about your agency tends to spread quickly, attracting even more candidates of different backgrounds.
5. Inclusion sends a positive message about your brand
When a prospect or client hears your name or the name of your agency, would you rather have him or her associate that name with “inclusive and forward-thinking” or with “old-school and same old, same old?” Would you want your community to think about you as “open to new ideas and new people” or “inflexible and married to your own ideas?”
The inclusion of women and diverse people with different perspectives speaks loudly about your philosophy, your brand and your willingness to embrace new ideas.
It is critical to position our business for the future. Any entrepreneur in the financial services sector who is serious about thriving today and tomorrow should take steps now to ensure women are not only “present” on the team, but that they also have a voice at the table.
• Editor’s Note: Coming soon – an all-new newsletter for women in the industry dedicated exclusively to providing resources – profiles in success, case studies, peer-to-peer advice, helpful tips and more – that will feed the ambitions and tackle the key issues facing women producers. Stay tuned!
James Cowan is the director of Next Markets at Ohio National Financial Services. He can be reached at jam[email protected] or 513-794-8557.
1 Bier, Jerilyn Klein. “Wanted: Women Financial Advisors.” Financial Advisor Magazine. www.fa-mag.com/news/wanted—women-financial-advisors-25321.html. March 1, 2016
2 Blayney, Eleanor. “Why there are so Few Female Financial Planners.” The Wall Street Journal. www.lblogs.wsj.com/experts/2015/10/29. October 29, 2015
3 Kay, Barbara and DiLeonardi, Anthony. “The $14 Trillion Woman.” www.booksurge.com, 2009
4 Buchanan, Holly. “Selling Financial Services to Women.” Hachet Publishing, 2012
5 MacBride, Elizabeth. “A Diversity Problem.” www.InvestmentNews.com. December 14, 2015