Where Are the Women Advisors?
An industry rainmaker shares some theories about what’s keeping them away or pushing them to the exit door.
What is the problem with women advisors and wealth management?
Where are all the women? Why do women get chewed up and spit out?
Why do they start young and leave? What about the multimillions the CFP Board’s Center for Financial Planning and The American College of Financial Services put into fixing this issue, and why has this barely moved the needle? (I joined the Benefactors Circle for the CFP Board Center for Financial Planning specifically so I could help raise the number of women in the industry.)
After more than 30 years in the industry, I also have my own theories.
Women assume different roles
First, this is an industry that was built by men for men. The fact that we have more than 75% men and less than 25% women — based on the number of women CFPs — is actually not surprising. Many women in the financial advisory industry are in support roles, teaching roles and client service roles — or not practicing.
The small percentage of women who are client facing are not necessarily the ones hunting and rainmaking to acquire the clients. Based on my years of experience, I know the number of women who are bringing in clients is very small. I would guess less than 5% of female advisors are rainmakers. I happen to be one of them and once I was called a unicorn by a male advisor because of it!
A late awakening
For my first couple of decades in this industry, I honestly never thought about how male-dominated the financial advisor business was. I had an epiphany about 10 years ago, when I was at a TD Ameritrade conference and the line was out the door for the men’s bathroom. A female friend and I were able to just walk into the ladies’ room and we were the only ones there. This image, so opposite of what I was accustomed to, shocked me so much that I took a picture of it. I am not sure why it took me so long to see how outnumbered women are in the advisory world.
Better metrics can help
In most cases, women advisors get clients in non-traditional ways. We are often relationship based or consultative rather than transactional.
The industry’s commonly used words of measurement — GDC (gross dealer concession), AUM (assets under management), revenue, trailing 12, etc. — sound like a male measuring stick. And what about being called a “producer.” Every time I hear that I think, “Wow, am I a cow?” Maybe a cash cow but still a cow.
I always use to say, “You can’t tell what I make from my AUM.” I get retainer fees and flat fees, and my business is not reflected in just my AUM. Some brokers have massive AUM on which they don’t collect fees.
I believe there are far better ways to measure an advisor’s contribution to a firm — and that would be more favorable to females. How many families does an advisor serve? How many relationships does an advisor have? Or how many lives has the advisor changed? How deep are the relationships? How many clients consider that advisor a VIP in their lives? That feels impactful and important to me. Yet, advisors are rarely celebrated in trade publications unless big AUM numbers are next to their names.
Women clients are different, too
Now for the women who want to be clients: They don’t wake up one day like a man does and say, “I am hiring a financial planner today.” Instead, in almost every case, they need to hire a financial planner when they are in a crisis. A death, divorce, downsizing, etc.
Unfortunately, female clients don’t know where to look, who to trust, etc.
And even sadder, the profession is not full of people with empathy who truly care about the clients. They care enough to get the assets but will they take a call on the weekend if a client is crying about their life falling apart? Will they accompany a client who needs to retrieve her car from an impound lot because her boyfriend drove drunk? Will they work with clients to make their lives better, or do they only care about their money?
It’s also important to note that women clients have a longer sales cycle and are more complex than men. Most of them don’t even trust the stock market; they have to be educated about it. And guess what? They are very open to that.
What if the language was about the “softer side of planning?” For example:
- How can you maximize your happiness?
- How can you live your best life?
- How can you have freedom?
- How can money give you choices?
Planning is collaborative — not preaching or telling or saying, “Don’t worry your pretty head about this; I got you.”
My request for you
I don’t have all the answers, but I want to start a dialogue.
I don’t think men are even aware of this problem. Many have unconscious bias or are just doing what works for men — who usually make up the majority of their clients.
But women also have conscious or unconscious bias. I had a female client refer a female friend to me and that prospect told me, “I would never work with a women; A man can take better care of me.” Ouch that hurt!
By 2030, which is only seven years away, women will control two-thirds of the nation’s wealth, according to some estimates. This industry must change to meet these needs.
I started the women’s leadership initiative at my old firm. Now I have the privilege of heading Women and Wealth at my current firm, ACM.
Will you help me change the world? I will speak to any woman who wants to talk about entering the industry — or anyone who wants to help. I would love to know your thoughts. Let’s get this conversation started!
Cary Carbonaro, CFP, MBA, is SVP, director of Women & Wealth at ACM Wealth, the wealth planning team of Advisors Capital Management. She was appointed and has served as a CFP Board ambassador since 2014. Cary is the author of “The Money Queen’s Guide: For Women Who Want Build Wealth and Banish Fear.” She has spoken all over the world about financial literacy for women. You can reach her at firstname.lastname@example.org.
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