There’s a rule in politics that also applies to financial advice: You don’t tell people what is important to them, they tell you. You just have to listen.

But the advisor industry at large hasn’t been listening to women investors. In fact, women are more disappointed, more disengaged and more likely to leave their male financial advisors than ever before, according to scathing new research from New York Life Investments’ Advisor Advancement Institute. The research follows up on a benchmark 2019 study.

Women investors report that their financial advisors “treat them differently.” They also feel more “patronized by financial advisors” who they said are “less likely to listen to their ideas” and “push women out of conversations.”

According to the research, the following problems led more women to fire their male advisors:

  • Poor customer service (reported by 39% of women in the study, up from 27% in 2019);
  • The lack of a personal connection with their financial advisor (cited by 32%, up from 29% in 2019);
  • Poor performance (cited by 45% of women, up from 33% in 2019).

“Too often we hear the reason why women leave their husband’s advisor is because they felt like the advisor was their husband’s advisor. Not their advisor. Retaining women clients comes down to building the relationship with them and meeting their client service expectations and needs,” said Janet Koh, director, Advisor Advancement Institute, New York Life Investments.

Michelle Crumm, the founder and president of Belle Eve Financial, Ann Arbor, Mich., is one of those advisors who has picked up female clients from male competitors. She said one of her new clients previously worked with a male who “mansplained things” and never really listened to the client, educated her or seemed interested in her financial outlook. Crumm’s approach is to use empathy, “a relatable communication style” and personalized, holistic financial planning to attract and retain women clients—all attributes that women clients prefer, according to the New York Life Investments findings.

Joanne Burke, the founder and lead planner of Birch Street Advisors in Vienna, Va., said she was recently hired by a female who also terminated her male advisor after he sent her first retirement plan distribution to her without discussing it with her first.

“He had no idea what the woman wanted to do with her money,” Burke said. “There was no communication. The trust and relationship were missing.” She adds that many of her clients are retired women executives in charge of their households’ financial decisions.

“I also have a lot of women widowers who are in charge of their finances, but what I find fascinating is when I get a couple who comes in because the husband wants to find a woman advisor for his wife in the event he passes. I’ve seen this three times recently,” Burke said.

Women already manage $10 trillion in wealth and are projected to wield $30 trillion by 2030. So decoding what female investors want from their advisors and avoiding unforced errors is increasingly important.

“For advisors looking to retain their women clients, the first and foremost avoidable pitfall is not having a relationship with them,” Koh said. “Advisors need to ensure women are part of the conversation, present at every meeting, understand and agree with recommendations, essentially, [and] are active partners in the relationship with their financial advisor or team.”

Carla T. Adams, a CFP and the founder and president of Ametrine Wealth in Lake Orion, Mich., recently launched her own firm after working at a larger wealth manager for 15 years. Already, seven of her 13 clients are women, and four are from households where the woman makes the decisions.

Both women and couples who have fired their previous advisors have sought her out, Adams said.

“What I do is simple, but it seems not enough advisors are doing it: I listen to my clients, and I talk to them in plain language that they can understand. I make no assumptions about people as I’m getting to know them.

“Everybody’s brains work differently, so sometimes it may take a few tries for me to explain a concept in a way that makes sense to my clients. Most of my clients are very smart, highly educated people, but they are not educated in finance, which is why they’ve hired me in the first place,” Adams adds.

And the role of advisors, especially women advisors, in female investors’ financial lives has never been more important. According to institute findings, 87% of women say they need to rely on their advisors for information about their finances and investments and some 48% of them prefer to work with women advisors or have at least one woman advisor on the team (something cited by 54% of those surveyed). This is critical because women report their investing knowledge and confidence have decreased significantly over the past five years.

“The future of the financial services industry is going to belong to women, because they’re much more geared to financial planning as opposed to investment management,” said Nancy Daoud, the founder and president of Opus: Advice First, an Oxford, Conn.-based private wealth advisory firm (affiliated with Ameriprise), that has $800 million under management and advises on another $800 million in assets held away from the firm. Three of the firm’s seven advisors are women.

“The secret sauce to making clients loyal or sticky is deep relationships,” Daoud said. “Start with real basics. Not going into analytics and charts. One of the things that is so intuitive to me is having both spouses attend meetings, no matter what they say. It starts with engaging female spouses and making eye contact and making sure there is a relationship built with both spouses.”

She also makes sure to seek out female clients’ opinions. “When a question is posed, I say ‘Let’s start with ladies first, what’s your opinion?’ When you listen and validate, clients tend to trust you more,” Daoud said.

The firm currently works with 1,100 households in 38 states. “We look to enhance the financial and emotional well-being of clients through an education process and decision-making. We have many divorcees [and] a good number of women whose spouse died and now they’re single women. As we build the next generation of clients, we’re seeing a real evolution, where the women in their 30s and 40s are the real earners,” Daoud said.

To deepen relationships, Opus holds lunches, dinners and happy hours for female clients several times a year, and Daoud said she will also send a note or call clients just to say “Happy birthday” or touch base and see how they’re doing. “It might sound insignificant, but it’s over-delivery. If you have a trained back office and process for providing all of these little touches, they happen automatically, but to the client they’re unique,” she adds.

Bridget Grimes is the founder and president of Coronado, Calif., firm WealthChoice, and is also the co-founder of the Equita Financial Network, an RIA platform for firms led by women. She said she has sent out a survey asking clients for the number one reason they work with her firm. 

“Overwhelmingly,” said Grimes, “the answer was trust. I think trust is very important for women. When they feel heard and understood, they trust you. Planners need to do a better job of listening and understanding the challenges women have so they can build trust.”

To earn that trust, advisors must learn to provide advice on the things that disrupt financial plans, such as childcare and eldercare, which can leave them with work gaps. Your female clients will be less likely to leave, Grimes said, if you recognize these challenges, talk about them, come up with a plan, and make them accountable for it. Such moves will help them succeed financially, she said.