Financial advisors who want to boost their clientele numbers should look to the growing number of women who own their own businesses as predictions call for them to control more than half of personal wealth by 2026, a recent Canada Life webinar was told.
An Investor Economics Household Balance Sheet Report estimates that in five years’ time women investors will be directly responsible for half of the country’s personal wealth, while the number of women continues to grow and they outlive their spouses.
With women having more money to invest – even today – they also want more from their advisors regardless of whether that advisor is male or female, said Abbie MacMillan, vice president, Advisor Practice Development & Talent at Canada Life.
Advisors can play a key role
And this means there is an important role that financial advisors can play, one that has been amplified by the pandemic.
An RBC Economics report figures about 100,000 women have left the labour market since the onset of COVID-19 in February 2020 in what it termed the “she-cession.”
Employment has dropped for some women, especially those less educated and over-represented in service roles in industries like retail and restaurants, said Beatrix Dart, professor of strategy at the Rotman School of Management and academic director of the Initiative for Women in Business.
With the economy opening up some of these jobs are coming back, but many people in these low-paying jobs prefer to stay at home because they can fare better with the federal subsidies they can collect, said Dart.
Women with post-secondary education and families aren’t rushing back to an office environment either, preferring instead to work remotely where they can keep an eye on younger children.
Then there are women who can afford not to work. “We see a huge reluctance for women in this group to come back to the workforce,” said Dart.
Entering the workplace
But then there are new streams of women who are entering the workplace and make up the “woman entrepreneur market segment.”
These include empty nesters, women who have opened up lifestyle-type businesses but have little intention of growing their company; women entrepreneurs whose businesses are increasing slowly as well as serious entrepreneurs who are committed to their businesses and want to be internationally successful. Immigrant women are a growing category of entrepreneurs in Canada as well, said Dart.
Many of these businesses owners have household duties on top of their everyday working lives and need help when it comes to financial data.
“I would say this is a wonderful growing market for financial advisors to look into,” said Dart.
Many of these business owners want better communication, interpersonal and listening skills from their advisors, and they must have the ability to explain complex information to these entrepreneurs, said MacMillan. “They want to network and establish a relationship – they don’t just want to do business.”
