Three ways to create deeper connections with female clients – The Globe and Mail

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Although women are projected to control $4-trillion in assets by 2028, according to a recent Sun Life Global Investments report, they’re still vastly underserved by the financial services industry.
Barbara Stewart, chartered financial analyst and independent researcher on women and finances, chalks this up to advisors not building deeper relationships with women and understanding their true needs. And if a woman goes through a major life transition, such as a divorce or death of a spouse, she is likely to switch to an advisor who makes more of an effort.
Globe Advisor reporter Deanne Gage spoke recently with Ms. Stewart in a LinkedIn Live event about suddenly single women and how advisors can best help them.
Around 80 per cent of widows switch advisors soon after the death of their spouse. How can an advisor avoid that situation?
I’ve learned there are three things not to do when it comes to working with female clients. First, don’t judge them at all. They may not want to learn more about money. They may not want to take your advice about something. Don’t judge them, just listen.
Second, don’t lecture them. We tend to overuse “should,” such as, “You should be learning more about money,” or “You should take an interest.” Women just hear that as another thing to add to their to-do list on their busy days. The word “should” needs to get extracted from any advisor’s vocabulary.
Third and most important is not to make assumptions. When somebody’s going through a divorce or widowhood, we tend to think they’re feeling horrible, sad, all of that stuff. And of course, that’s what society expects. But I’ve found that some may confide this can be a happy thing. Some people are actually ecstatic when they’re getting divorced. If they have a death of a spouse, you don’t know what was going on in that relationship beforehand. You have an opportunity to really listen.
Most advisors today work with both spouses. So, where’s the disconnect with the female spouse?
Sometimes, not all [the information] gets disclosed in those advisor conversations with couples.
If you’re dealing with both partners in a couple, plan to see them one on one as well as together. And the reason for that is each person is an individual, and each may have different things to say. Sometimes, in a couple, you don’t want to make your spouse look bad because they know more than you do or they don’t know as much as you do and you don’t want them to interfere with your happy dynamic.
Yes, meeting one on one is time-consuming. But it’s really going to be worthwhile to deepen both of those relationships.
Do women advisors have an advantage in working with suddenly single women? How can male advisors play a role?
Women have been shown to have higher levels of empathy. Research has shown women have more of an ability to explain difficult financial concepts in simple terms and that’s key.
Now, are there good male advisors out there who can communicate brilliantly? Yes, I’ve met many of them. It’s usually the ability to communicate that will separate the really good advisors, especially the ones who want to work with women.
But when you meet those men, they will have high levels of empathy and the ability to explain things in simple terms. They’re probably active listeners and not relying so much on big spreadsheets.
This interview has been edited and condensed. The entire interview can be viewed here.
– Deanne Gage, Globe Advisor reporter
Where investors put their money in this year’s RRSP season
If registered retirement savings plan (RRSP) season is a market bellwether, investors are betting on more volatility ahead and believe interest rates will remain high for a while. For the first two months of this year – the time when many contribute to their RRSPs – investors poured money into fixed-income products including guaranteed investment certificates, high-interest savings accounts and short-term bonds. All are paying interest of roughly 5 per cent, well above rates offered on those products during last year’s RRSP season. Brenda Bouw looks at investment inflows into funds and what experts say about these trends.
How to play the demand for microprocessors as chatbots, robots and EVs disrupt sectors
While industrial automation showed the way during the pandemic – moving goods at a time of lockdowns and labour shortages – COVID-19′s impact on digital automation and the way people interact with technology may have a more lasting effect. Analysts say the excitement around ChatGPT, the user-friendly interactive chatbot Microsoft Corp. is building into its Bing search engine and Edge internet browser, is one example of the trend. While the focus of attention is on how ChatGPT answers complex questions in a user-friendly interactive way, they say a bigger story – and investment opportunity – is in the powerful microprocessors that make it all work. Adam Mayers gives an outlook for the sector and how to invest in it.
Small but mighty – five reasons why small caps are set to outperform
Even though small-cap stocks represent a mere 10 per cent of the equity universe, they generate an outsized emotional response with polarized groups of lovers, haters, enthusiasts and abstainers. As such, they tend to be unloved and, therefore, undervalued for stretches of time although these same attributes also make them ripe for active stock pickers. They should not be dismissed, says David Barr of PenderFund Capital Management – particularly at today’s attractive valuations. He gives reasons to reconsider small-cap stocks.
How to guide clients who have suffered through trauma to reach their financial goals
Any kind of trauma – no matter the cause – can impact people’s sense of safety and worth, which is tied to money. Some financial behaviours linked to trauma include not negotiating contracts or raises, overspending on items for social acceptance, excessive risk aversion, workaholism, or not advocating for one’s financial needs, says an expert. Many abuse survivors also don’t have a sense of themselves in the future, which can affect their willingness or ability to plan. Barbara Balfour speaks to experts on how advisors can identify signs of trauma in clients and help them deal with it.
Why this portfolio manager is betting on fixed-income, dividend-paying securities while selling tech, health care
This 59-year-old retiree expected to miss big-city life but found new interests during the pandemic
Tax-loss harvesting – an investment tactic that has gone too far
How to change the conversation when addressing charitable giving with younger clients
Money market funds swell by more than US$286-billion as investors pull deposits from banks
Ottawa’s newest tax hit signals concerning reliance on financial sector for revenue, analysts say
Ottawa’s plans to pull billions of additional dollars from banks and insurers signals a concerning shift as the federal government turns increasingly to the financial sector for revenue, analysts say. In the federal budget delivered on Tuesday, the Liberals unveiled the amendment to tax rules on dividends that financial institutions receive from Canadian companies. The measure is expected to generate $3.15-billion over five years starting in 2024, and $790-million annually after that. The latest change requires financial companies to account for dividends of Canadian shares that they hold, which lawyers say could create multiple layers of taxation. Stefanie Marotta and Jameson Berkow report on this latest measure.
Banking flare-ups may help tame inflation
Facing the spectre of a full-on banking crisis, many lenders will now be forced to build up their defences. That typically involves tightening lending standards and restricting credit, which is precisely what central banks have been trying to orchestrate for the past year. There’s every reason to think that banks will be spooked into behaving more conservatively, thus doing part of central bankers’ job. The effect could be the equivalent of 100 basis points of central bank interest rate hikes, says an expert. Other analysts have estimated the effect at 150 basis points. Tim Shufelt speaks to analysts about the impact.
Should older retirees trust their financial judgment?
A U.S. study first released in 2012 found that as people age, they have a diminished ability to make sound financial decisions. The study asked Americans aged 60 to 88 a series of multiple-choice questions on insurance and investments. They were also asked how confident they were of their answers. The financial literacy test scores declined markedly with age, with the low point at 88 being worse than random guessing. At the same time, confidence in their knowledge actually rose. Frederick Vettese looks at whether retirement planning needs to be automated as much as possible, especially after a certain age.
– Globe Advisor Staff
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