Women remain relatively underserved by financial professionals, despite women’s growing earning power and their interest in partnering with a financial professional, according to a 2012-2013 study by Prudential.

Women are open to working with a financial professional; in fact more than a third of women (35 percent) who do not use a financial professional  would consider doing so. The question many financial professionals should ask themselves is how do you connect with the women’s market?

Developing a female friendly-financial planning practice isn’t just about having fresh flowers in the office and an annual women’s brunch. The first step is to appreciate the size and influence of this market. Additional studies conducted by Pershing (Women are not a “Niche” Market, March 2012) and Information Asset Partners (Market Dynamics of Single Women Investors, December 2012) showed that women control nearly two-thirds of annual spending and are the head of almost one-third of households in the U.S.

The good news is that between single females and married couples, women probably already make up a substantial portion of your book of business. The bad news is that the Pershing report stated that 70 percent of married women fire their financial professional within one year after the death of their husband, and that women are likely to outlive their husband by 15 years. That means keeping current female clients is just as important as attracting new ones, particularly at the time of the husband’s death.

Working with female clients is not that different from working with males. That doesn’t mean you can merely “shrink it and pink it,” a clothing industry term for the simple redesign of men’s products. Instead, it’s important that women know you are aware of issues that are specific to them, such as longer life expectancies, higher health-care costs and their often reduced participation in the workplace. To attract and retain women clients, you need to show that you understand their concerns and have strategies to address them.

Be Inclusive. For married couples, include both spouses in retirement planning conversations.

Here are three useful tips:

• Discuss long-term care options: According to the American Association for Long Term Care Insurance, 41 percent of women leave the workplace to care for their husbands. 

• Address longevity: The Pershing study showed that 50 percent of women will live past age 88, so it is not surprising that women comprise 75 percent of the assisted-living population.

• Ask questions that each spouse can answer separately. Ask each spouse to write down their answers. This allows them to share their opinions with you and with each other. Ask the following questions: “If you could no longer take care of yourself, who would care for you?” And, “How much money will you need per month in retirement?” In response to the first question, you will learn what long-term thinking the couple has done. This will lead you to conversations about disability and long-term care insurance. As for the second question, whether you end up with one number or two, you have been inclusive and opened up the conversation of how that monthly income can be provided.

Offer Security

Whether a client is male or female, single or married, the monthly income number you acquired is important to that client.

Rest assured, no client wants to run out of money before they run out of breath. Focus on the basic need for security and guaranteed sources of income, such as pensions, Social Security and annuities. When evaluating Social Security, consider the long-term impact various decisions will have on the woman’s retirement income. Social Security is based on the highest 35 years of employment, yet women spend fewer years in the workforce due to caring for children, parents and spouses. For any years of employment less than 35, the administration uses zero dollar amounts. The impact of these zeros is a reduced Social Security benefit. For women who may be considering a spousal or survivor benefit as an integral part of their retirement, they need to understand the impact of their husband’s decision on his own retirement security. The Social Security Administration states that 74 percent of retirees elect to take their Social Security benefit early, resulting not only in a reduced amount to them, but to their surviving spouse as well. For a surviving spouse, this can result in a 30 percent reduction in income from this one source.

Investigate all investment and retirement income sources, including annuities and pensions. Determine what distribution options are available and the term over which they will be paid out. Common options are single life and joint life. Also inquire if the pension is subject to a reduction due to pension leveling and at what age eligibility begins. In order to have the largest income check, the single life option is often chosen, resulting in a reduction to household income when the retiree dies. Next, look at other retirement accounts, such as 401(k)s and IRAs, for opportunities to use these funds to generate an income stream. These accounts can invest in stocks, bonds, mutual funds and annuities. With life expectancies increasing, consider an annuity with a guaranteed lifetime living benefit to help insure that retirement income needs are met. Furthermore, when working with married couples consider using an annuity with a joint-life living benefit within the IRA as a way of having an individual account provide financial security for the lives of both spouses.

Be Simple

Simple does not mean condescending. Everyone appreciates the simplicity of a solid retirement story. Start with how much money the client has  and how much more can be saved prior to retirement. Examine the source and duration; one life, two lives or a certain period of that income.  Consider how the investments within an account can provide lifetime income.

Be inclusive, offer security and keep it simple. A starting point for connecting to the women’s market can begin by educating yourself on common retirement plan options for jobs historically held by women, such as teachers and nurses. Knowing the specifics of these retirement plans can help position you as the trusted financial professional for single women or married couples, where the wife works in that given profession. Keep in mind that women may be in the workforce for a shorter period of time, but their years in retirement are often greater than their male counterparts. Focus on retirement income strategies for your true, long-term client. She will appreciate it.

Investors should consider the contract and the underlying portfolios’ investment objectives, risks, charges and expenses carefully before investing. This and other important information is contained in the prospectus, which your clients should read carefully before investing.

Sonja Hayes, J.D.,LL.M.,CLU, is director of Advanced Markets at Prudential.