According to data from the Bureau of Labor Statistics, women personal financial advisors working full time in 2018 earned 73 cents for every dollar earned by their male peers. In 2016, the women earned just 56% of what men earned—the biggest gender disparity among all professions tracked by the bureau.
Kimberly Foss, president and founder of Empyrion Wealth Management in Roseville, Calif., is concerned by the “churn and burn” pace that advisors at the wirehouses are expected to keep in order to quickly develop a huge book of business. From what she hears from young brokers, the production demands are even tougher now than when she departed Merrill Lynch for the RIA world over 20 years ago.
“Advisors pumped up on that might not make the right decisions for clients,” says Foss. She thinks RIA practices are more conducive to women because “we’re planners, we’re organizers and we look to the future.”
Catherine Seeber, an advisor at CAPTRUST in Lewes, Del., has found women advisors are more likely to succeed if they have mentors to help them through work challenges and if they find the right corporate culture. “They need to go where they will flourish and it’s not one-size-fits all,” she says. “They have to match their personality and their drive with the company that they decide to associate themselves with.”
“The biggest stumbling block for advisors is consumer perception of what advisors actually do,” says Seeber. Financial planners are emphasizing the value of all the things they do beyond the investment piece. Those with a primary focus (either with a particular type of work or type of client) are becoming the most successful, she says. Advisors need to develop client needs around client goals, she adds.
Reaching Underserved Markets
Women advisors are successfully carving out niches in underserved markets. Reshell Smith, a CFP and the founder and CEO of AMES Financial Solutions in Ocoee, Fla., focuses on minority women.
“I think we haven’t done a great job as advisors, overall, going to the places where [these clients] are,” she says, including churches, women empowerment events and festivals geared toward minority women. She believes any advisor could successfully work with minority women, but their “initial touch with a financial advisor,” she says, is generally someone referred to them through their friends, family or church.
Cheryl Glazer, who has a master's degree in taxation, runs a divorce and transitions financial consulting practice in Wynnewood, Pa. The divorce planning niche requires a lot of patience, diligence and dedication, she says. “You’re working with people in a very delicate situation.” Clients are often fragile, she says, and things can move exceedingly slowly.
Advisors must meet a number of challenges, says Glazer, including trying to get folks to agree, staying objective and keeping up with tax law changes. Advisors often have to give women going through divorce a financial education and the confidence to look ahead, she adds. Divorce and transitions planning could be a good fit for many female advisors because “women are great collaborators, and they’re good conciliators,” she says.