Christopher Maule, the CEO of UK Bond Network argues that not only does the financial services industry need to do more to engage women but that as the number of female millionaires overtakes men, it is also in our interest to do so
Last month, research from the International Longevity Centre (ILC), revealed that women were consistently less financially aware than men on how to achieve income security in retirement.
While this research focused on understanding around pensions, it’s little secret that the financial services sector has been slow to embrace women and has concentrated on providing products and services with men in mind. But, with women increasingly becoming wealthier and more financially independent, this is both anachronistic and short-sighted.
Besides this disinterest, the sector has cultivated a macho image that, if not deliberately, certainly helped alienate women as potential customers and investors. While these legacy issues have had a lasting impact on the financial awareness of older women, the good news is that the tide is turning.
As the numbers of female professionals, senior executives and entrepreneurs grow, women’s potential to earn money - and large quantities of it – is causing the FS community to sit up and take notice.
Research from International Women’s Day suggests that the number of UK female millionaires is increasing by 11% a year, and by 2020, 53% of the country’s millionaires will be women. More than a social nicety, it is now within the sector’s best interests to provide products and services that appeal specifically to the female market.
To take advantage of this opportunity, institutions will have to understand what women want and how to communicate with them. From our own analysis, we know that women typically prefer to invest or save for a specific long-term purpose – to achieve a life goal such as getting on the property ladder for example. This is in contrast to men, who are more likely to focus on immediate returns.
Institutions will have to understand what women want and how to communicate with them”
To appeal to the female market therefore, members of the financial services community, need to consider women’s priorities and address these in their offerings - be they pensions, annuities or other investment vehicles.
Since its launch, UK Bond Network has received an increasing level of interest from High Net Worth women looking to take control of their own investments. This echoes the broader trends we’re seeing across the industry where female investors are becoming more active. It is also likely to be, at least in part, due to the nature of the investment, which offers a secured return over a longer-term period.
This echoes the broader trends we’re seeing across the industry where female investors are becoming more active”
Another attraction might be the level of information available on a company to potential investors, as women are typically more methodical when it comes to researching financial decisions. Therefore platforms or investments that provide detailed information, clearly highlight risks and enable participants to conduct their own thorough research, are more likely to appeal to women.
While the ILC’s research paints a grim picture of institutional bias, the situation for women is changing. This may be because the financial sector has realised the error of its ways and decided women deserve better service.
The ILC’s research paints a grim picture of institutional bias”
What is certain is that, with the number of UK female millionaires increasing at 11% per annum, engaging with this affluent and receptive market segment makes good business sense.
Christopher Maule, CEO, UK Bond Network