A Story of Women & Wealth

Continuing our trend of centering women throughout women’s history month, this week we wanted to share “A Story of Women & Wealth,” as told through a collection of quotes, statistics, and gifs.

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Setting the stage

• According to the UN, “women’s economic empowerment boosts productivity, increases economic diversification and income equality in addition to other positive development outcomes. For example, increasing the female employment rates in OECD countries to match that of Sweden, could boost GDP by over USD 6 trillion, recognizing, however, that growth does not automatically lead to a reduction in gender-based inequality. Conversely, it is estimated that gender gaps cost the economy some 15 percent of GDP.”

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Women & money

• An unprecedented amount of assets will shift into the hands of U.S. women over the next three to five years, representing a $30 trillion opportunity by the end of the decade.

• Women control a third of total US household financial assets—more than $10 trillion.

• 70% of women change advisors within 1 year of their partners dying. The prize is substantial. Analysis by McKinsey’s PriceMetrix indicates that simply by retaining baby-boomer women (the segment we see being most at risk of churning) as clients, firms could see one-third higher revenue potential.

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Women in wealth management

• Women account for 67% of support staff in financial services, but only 15% of executives.

• In 2008, of the 430,000 financial advisors accounted for by the Bureau of Labor Statistics' Current Population Survey (CPS), 34.3% were women. In 2018, that percentage had dropped to 33.5% female financial advisors of 537,000 total.

• Not only are financial firms hiring more men than women, but women are also exiting the industry at higher rates. Female executives in financial services are leaving the industry at a rate of 15.8% compared to 7.7% for executive men.

• In 2018, the median weekly earnings among female personal financial advisors was $1,207 compared to $1,647 for men. That amounts to the median male advisor earning $22,880 more annually than the median female financial advisor.

• As dire as the ratio of women to men financial advisors is, it's even worse for people of color. In 2018, only 5% of financial advisors identified as black or African American, less than 7% as Asian, and 6.6% as Hispanic or Latino.

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Women in asset management

• Women manage only 2% of all assets, and the proportion of female portfolio managers fell to 9% from 10% between 2009 to 2015 — despite the fact that women managers outperform their male counterparts, according to Morningstar.

• Junior women are 24% less likely to be promoted than compared to male counterparts.

• In 2015, research found the average AUM of a female-owned fund is $115 million.

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So what can we glean from all this? Quite simply, we have a lot of work to do, but we can do it! If you missed last week’s post, we talked about what we as investors can do to fight for gender parity. Check it out here.