Pattie Lovett-Reid: Investment firms that make inroads with women will win

How have financial institutions still not understood this?

In my previous career in wealth management, I ran a program called Women in the Know. I wrote books on women and investing, held seminars across the country, and truly believed that great progress was being made.

Women told me over a decade ago that they wanted a seat at the table…they wanted recognition in household financial discussions and wanted to invest more aggressively. At the time, they felt it was not a lack of ability, but a lack of time that was holding them back. Simply put, there weren’t enough hours in the day, so investment was often delegated to other household members.

Fast forward to today. Women have become an economic force, but the same problems still exist, so women are firing on all cylinders.

Women are a powerful demographic moving up the corporate ladder, increasingly becoming female entrepreneurs, and post-secondary institutions have seen an increase in the number of female graduates.

For more than two decades, I’ve seen financial institutions tout new strategies to target the female market – in all likelihood because it just makes good business sense.

Yet breakthroughs have been blocked and initiatives have been put on hold.

In a new study commissioned by BNY Mellon, data pointed out that if women invested at the same rate as their male counterparts, there could be an additional US$3.22 trillion available for investment today. This staggering amount of money is a good reason to dedicate resources to the initiative and bring it back to the forefront.

Of course, there have always been obstacles that have held women back when it comes to investing – when you look at the challenges in isolation, it almost always boils down to one thing – effective communication.

The report found three powerful obstacles.

The first finding was that women were not indifferent to investing, but many were insecure as a direct result of the investment community not reaching out to them.

The income barrier is the second. On average, women estimate that they need $4,092 of disposable income each month to invest, or close to $50,000 per year. For most, that would be unreachable.

And the final challenge – nearly half (45%) say investing in the market is too risky for them.

I agree that women need to take control, but the industry really needs to address these core concerns to finally make lasting breakthroughs.

Women don’t want targeted products or fancy packaging, and history will tell you they’re very comfortable dealing with either gender as an advisor. What they want is to be heard, their goals recognized, and an investment path forward that makes sense to them.

Knowledge is a powerful equalizer.

If the investment community succeeds, women win, the economy wins, and society wins. It’s high time women made their money work as hard for them as they earned it. Once advisors understand that women want to invest according to their values ​​and that the goal of investing isn’t always about returns, this will be the company that finally breaks through in an industry that hasn’t simply not kept pace with the progress being made.