A Can’t-Miss Opportunity to Future Proof Your Business

Keep It Real

On top of the enormous toll the pandemic has taken on global health, it has also magnified the responsibilities of working women. Countless studies have documented the disproportionate effects on this population – from upending work/life balance with the need to juggle extra caregiving and teaching duties to the mental health effects of isolation. Nearly 82% of women surveyed globally said their lives have been negatively disrupted by the COVID-19 pandemic.¹ What does this mean for Advisors?

It’s created an opportunity to deepen relationships with female clients – and keep it real. When you only see people in a business sense, you can easily forget they’re human beings too. The pandemic has changed all that (particularly with the proliferation of web conferencing platforms), and added a “real life” element that Advisors can use to engage with women.

For example, at the beginning of the virus outbreak in March 2020, I created a resource for virtual activities parents could do with their children at home, which is a great value-add tool Advisors can send to their own client base. Because at the end of the day, when the economy does eventually reopen, it won’t be an additional 10% return people will talk about. It will be ideas that led to a memorable afternoon for their kids and created a helpful distraction. Forming a bond, and relating as a fellow parent, can go a long way to strengthening ties with women – whether you’re sharing insights, tips or fears.

How to Start Connecting – and Why

Given that the average age of widowhood in Canada is 56² (younger than most would expect), engaging and connecting directly with women is crucial for a sustainable business. Since over 70%³ of recent widows switch their financial Advisors after their spouse passes, Advisors have every incentive to build relationships with female clients on day one, especially in circumstances when they’re not the primary account holder. One of the best industry books I’ve read was Invest (in) HER: The Smart Financial Advisor’s Guide to Winning Female Clients in Six Easy Steps, because it really focuses on business strategy and demystifies the process through stories and real-life examples.

Importantly, one of its themes is that men and women experience life differently, and the latter typically connect best through planning-focused conversations about emotions and feelings, not necessarily performance or returns. So, consider having meaningful discussion topics in the bank that delve into their personal interests, life goals/dreams or current events, which you can ultimately link back to their finances (as an example, women express greater interest in responsible investing than men⁴ – learn more about our MyESG^TM tool below). The objective is to build to a comfort level that leads to a successful relationship, because very few women will seek a new Advisor based on one year of lacklustre performance. It’s the genuine, personal connection that matters, and displaying empathy for their situations – particularly during trying times like today.

Part of re-orienting your practice is understanding what your female clients care about during life’s major transitions, and how their attention may be divided across raising children, working professionally in senior roles, small business ownership, higher education and becoming caregivers to aging parents. This daunting load – which has become even more daunting with school closures – creates an opening for Advisors to help ease the added stress of financial oversight.

Taking the Time to Engage Pays Off

The pandemic has highlighted just how important it is for women to have an Advisor: many have had to leave the workforce for a period of time to care for others and give up wages. These changes need to be taken into consideration, and speak to the value of the relationship. Having a financial plan in place that’s continually re-assessed is critical. But many Advisors I’ve spoken with are often met with resistance from spouses who don’t feel the need to get involved in financial discussions, despite an open invitation.

While it’s a difficult conversation, it’s worth having a heart-to-heart with the client in question to simply ask, “why not”? Often, it’s about framing it in a way that resonates. For example, many women are diligent when it comes to taking care of themselves physically, and this is one way to take care of themselves financially. Otherwise, going to the gym and eating clean won’t matter if they can’t afford it. It’s an essential piece to their financial freedom down the road that must be a part of the process.

This is where empathy plays an important factor again. A potential scenario could be, “You and your husband want to be able to retire at 65, and you want to fund your kids through university, and you don’t want to have to worry about money. But, if your husband passes unexpectedly, are you confident you’ll still be able to reach all of these goals if you don’t understand your financial plan?” Also consider asking them questions about where they want to be, and what they want to identify with 20 years from now. Think of it as a backward induction process to help them get acquainted with their future selves, and what they need to do to get there. Once the planning discussion is on the table, Advisors can start to address any unique specifics where female clients are concerned, such as optimizing RRSP contributions ahead of maternity leave, and providing guidance on probate issues, for example.

Ultimately, the risks of inaction are too high. Even though the COVID-19 crisis will undoubtedly have near-term effects, the larger trends in women’s evolving role in the global economy are anticipated to continue. It’s a clear business opportunity, so it’s time to start personalizing your approach: currently, 37% of wealth in North America is held by women ($35.4 trillion), and is expected to grow at a steady 6.9% rate until 2023.⁵

For more insights to enrich your practice, contact your BMO Global Asset Management Regional Sales Representative.

¹ Deloitte Global Survey.

² National Center for Women and Retirement Research.

³ Financial Planning Standards Council Study, 2018.

⁴ 2020 Responsible Investment Association Investor Opinion Survey.

⁵ Boston Consulting Group. Managing the Next Decade of Women’s Wealth, April 2020.