Whenever I walk into a networking event for financial advisors, reality hits. I am usually still only one of two, maybe three, women among all my male colleagues. According to Cerulli Associates, a little over 14% of financial advisors in the United States were female in 2017. That statistic should not come as a surprise since we are such a small portion of the industry, but it still catches me off guard.

For many reasons, it’s critical that the future face of the industry be female. The big one is that in the next 10 to 25 years, $60 trillion in wealth is expected to transfer from baby boomers to their Generation X and millennial children, according to Cerulli. That’s a whole lot of advising to do. And that’s not all. During the same period, nearly 40% of financial advisors are expected to retire.

That means there will be a huge need for advisors, especially female ones, who will be in extremely high demand. That’s because women in the United States will control roughly $30 trillion by 2030, according to McKinsey & Company. It’s also because female investors prefer to work with female advisors. According to a 2013 Insured Retirement Institute study, 70% of women seeking a financial advisor would prefer to work with a female. They want advisors they can identify with and trust.

But it is not easy to find women here, for a few reasons:

• Young women don’t go into the profession. They tend to avoid finance as a career path. I frequently speak to female high school students in my community to educate them about what a career in wealth management entails, and what education and skills are needed to rise within the industry. Yet at career events, a lot of the female students I speak with still want to become teachers or nurses. While these are certainly worthy professions, it’s not right that finance gets less attention.

That’s especially true when the real problem is representation. It’s difficult as a young adult to figure out what you’re supposed to be doing with your life, and many choose professions where they have role models. The wealth management profession lacks female presence, and the industry will fail to meet client needs if this is not corrected soon. I believe our industry, like other sectors, will benefit from female perspectives, especially on risk and strategy. Clients don’t rely on just one single financial solution to achieve their long-term financial goals. They also need emotionally intelligent strategies and decisions, things women excel at. I can guarantee (from personal experience) that more diverse perspectives lead to a better client experience, and as the industry comes to realize that there’s more to a client’s success than financial performance, it’s a wonder we don’t value and hire more female advisors as expectations change.

• Female advisors don’t stay in the profession. I recently spoke with a representative from Texas Tech University’s financial planning program, who told me that, according to the program’s research, most females leave the wealth management industry seven to 10 years after entering. One reason is that they want to start families. They feel the hours and commute are not conducive to motherhood. I, however, experienced great flexibility in this profession when I became a parent, and I’ve been able to adjust my schedule to accommodate my needs as a mother.

Another reason women leave the industry is that they are often passed over for promotions. It is common for older men, who are surrounded by mostly male co-workers and who have spent years in a traditionally male-dominated industry, to overlook female professionals when promoting within their organizations, even if they do so subconsciously.

What We Can Do As An Industry
Ultimately, the solution to an industry-wide problem depends on the will of its members to act. Here are some basic steps we can take to resolve this imbalance:

• We must consciously and proactively recruit women. Those in leadership and C-suite roles in wealth management organizations must make a concerted effort to interview more female candidates when filling jobs and internships. If not enough women apply, they should call local schools or chapters of women’s industry organizations to find potential applicants.

At my firm, we hold out and wait for qualified women candidates to apply before hiring. We never throw up our hands and say, “Well, we couldn’t find anybody.” We call female professionals in our network and ask them if they know of someone they could recommend. We also regularly engage with business schools. And if we interview a qualified male candidate, we will hire him alongside a qualified female, so that both associates can be hired to do the same role.

• We must offer remote work options. The Covid-19 pandemic has shown us that it is possible to complete work responsibilities and engage with clients remotely. As our offices open back up, our industry should offer women hybrid work options that can simplify their work/life balance, especially women who have children or are looking to start a family.

• We must promote role models. If we demonstrate greater cultural awareness across the wealth management profession and make a genuine effort to hire young women as associates and promote them faster, we can produce more role models for the next generation of girls.

As a female registered investment advisor and practice owner, I believe our industry does so much to enhance the financial lives of individuals, families and communities. I know women have what it takes to play an important role in what we do if more of us are hired, and promoted, within wealth management firms. The reasons behind the lack of female representation in our profession are varied, but if all of us in positions of leadership and influence make an effort to recruit, mentor and promote women at our firms, we can make a meaningful impact not only on behalf of gender equality and inclusion but also in the lives of our clients.      

Meghan Railey, CFP, is co-founder and CFO of Optas Capital. A staunch advocate for female advancement, Railey is a member of both the board of directors and finance committee at ICA Cristo Rey Academy, an all-girls college preparatory work-study high school for underserved young women in San Francisco. Through her volunteer work with the Peninsula College Fund, she also serves as a mentor to a young woman who is the first member of her family to attend college.