Nicola Langridge, a CFP® at Private Client Holdings, says, “Women face distinct challenges and opportunities during their wealth creation journeys, which can influence their financial strategies. Financial advice for women should be tailored to meet their unique circumstances and be sensitive to their approach to finances and investing.” The following factors that women face should be incorporated in a robust wealth management plan:
Financial advice for women should be tailored to meet their unique circumstances and be sensitive to their approach to finances and investing.
Income Gap
Income disparity is one of the most significant differences in financial planning for women who on average earn less than men. This is often compounded by the fact that women are more likely to take career breaks to raise young families, which affects their ability to invest for the future, making tailored financial strategies more relevant.
Longevity
Women tend to live (on average) six years longer than men, which has profound implications for retirement planning as their savings must support them for an extended period. Healthcare costs also increase with age, which also requires careful planning.
Risk tolerance
Studies show that women tend to be more risk-averse than men, which influences their investment decisions. But women also
have the right balance between “greed” and “fear” and tend to filter out market noise and stay the course. While a conservative investment approach provides stability, it must be balanced with growth-oriented investments to achieve long-term financial goals. “Women should focus on long-term goals and strategies to accomplish what they want out of life – two things that shape the approach taken by a financial planner,” cautions Langridge.
Confidence gap
A 2022 survey by Fidelity Investments found that 70% of high-net worth women reported feeling less confident about their financial knowledge compared to 60% of high-net-worth men.
Empowering women with financial knowledge and building their confidence when it comes to managing their money is critical,- says Langridge.
Family Offices
Family Offices have traditionally been associated with managing the wealth of ultra-high-net-worth families. In recent years, the role of a Family Office approach in supporting women in managing their wealth has gained prominence. Women increasingly own equity in the businesses where they are employed, which results in more complex tax and asset management needs.
Holistic financial planning
A Family Office offers holistic financial planning that includes investment management, estate planning and tax optimisation. “For women, this comprehensive approach ensures that their unique financial needs and goals are addressed in an efficient and organised manner and that their life circumstances and aspirations are considered,” says Langridge.
Investment strategies
By understanding individual preferences, such as risk tolerance, long-term objectives and providing personalised advice, a Family Office helps women to build diversified portfolios that balance growth and security.
Legacy building
A Family Office assists with succession planning and legacy building by providing guidance on estate planning and wealth transfer to the next generation, ensuring that a woman’s intentions are preserved.
Life transitions
Women experience significant life transitions throughout their wealth-creation journey, such as marriage, divorce, motherhood, widowhood and career changes. A Family Office offers support during these critical periods by providing financial advice to navigate complex situations effectively.
Financial empowerment
By working with an empathetic financial planner supported by a team of specialists, women can be empowered with financial knowledge, which promotes independence in managing their wealth.
Networking
Private Client Holdings
A Family Office has extensive networks of professionals that women benefit from through mentorship opportunities, professional connections and access to a community of like-minded individuals.
In Lou Ann Lofton’s book, Warren Buffett Invests Like a Girl and Why You Should Too, she proposes that the attributes that make Buffett one of the best long-term investors are natural to women. Together with the support of a Family Office approach to wealth management, women are well-positioned to achieve their wealth management goals.
Private Client Holdings is an authorised financial services provider. Private Client Holdings has taken care to ensure that all the information provided herein is true and accurate. Private Client
Holdings will not be held responsible for any inaccuracies in the information herein and disclaims all loss, liability or expense of any nature whatsoever which may be attributable (directly, indirectly
or consequentially) to the use of the information provided
