Empowering women in transition
New and groundbreaking research from Fidelity
The loss of a spouse or end of a marriage is a uniquely stressful situation that pulls both husbands and wives into a swirl of emotional challenges, but wives may often face a sudden additional challenge: being the sole financial decision maker for the first time.
Many women in these situations may ask, “Who can I turn to for guidance?” And just as suddenly, your role and responsibility as a financial advisor will have grown. “Under such circumstances, women
may place a high premium on three advisor qualities: listening, perseverance, and compassion,” says Russ Thornton, Vice President and Wealthcare Advisor, Wealthcare Capital Management, Inc.
A thorough understanding of such major transitional moments may help you achieve a plan for your clients with the least amount of anxiety. With an estimated $2 trillion of money “in motion” due to
divorce or widowhood among American women, it can also help you protect and even grow your practice.1 Loss and divorce are, regrettably, common. A thoughtful, compassionate financial advisor may be in high demand in these situations.
We met with more than 20 financial advisors, and uncovered some strategies to help women address financial issues associated with divorce or the loss of a spouse.2 In this report, we explore those strategies as evidenced in the approaches of three of your peers, revealing new ways that may help to better serve your clients, retain them as they undergo a pivotal life transition, and ultimately help grow your business.
Beginning The Process
Five years ago, Debbie Riney Smith joined a financial advisory practice that mainly served male
business executives and lawyers in the Buckhead area of Atlanta. Few of their wives shared in the
financial advisory relationship. “Changes like divorce or loss are simply part of life,” Riney Smith says. “As I began working with these women directly, often under very trying circumstances, I discovered that they wanted not just someone they could trust, but someone they could talk to.”
Her prior 15 years of experience working in the financial services industry helped the practice
better understand the unique needs of women in transition, and, over time, develop a comprehensive
service offering. “Our practice went from a world in which husbands controlled everything — from paying the bills to overseeing investment decisions — to a world of empowered women working with us and leveraging our expertise,” says Riney Smith.
What’s her approach? For starters, many of the women Riney Smith works with need a lot of education and help in building their financial confidence. “It’s not uncommon for these women, many of whom are in their 50s or older, to discover for the first time that they have to pay the bills, put together a budget, and manage their investments,” says Riney Smith. “In addition to financial matters, they’re often looking for ways to rebuild their social circles.”
Some Steps Toward Empowerment
To help these women begin the process of empowering their lives, Riney Smith takes the following approach:
- Locate and value all assets. “We had a widow in her late 50s who didn’t even know where her money was,” says Riney Smith. “We went through boxes at her house to figure out what she had and where everything was. It’s an all-too-common occurrence in which a financial advisor’s help can be crucial.”
- Listen to clients’ lifestyle needs and concerns. Riney Smith says, “My clients ask questions like ‘Can I afford a new roof?’ ‘Can I afford to take a vacation?’ ‘Should I refinance my home?’ They also worry about whether they can still participate in their social circles, whether it’s country clubs or expensive dinners. We work with them to map out what their lifestyle needs and options are.”
- Develop a budget and financial plan. Riney Smith puts together a comprehensive financial plan, including a detailed budget. • Build a portfolio that aligns with their risk tolerance. “Focus the investment conversation on risk,” Riney Smith says. “This approach helps women get comfortable with the practice’s investment process, and builds trust.”
- Let them lead the conversations. For client meetings, she makes a point of starting with questions like, “What’s on your mind these days?” “What concerns do you currently have?” And “What do you want to cover today?” Riney Smith says, “While we [advisors] have our own agenda of what we need to cover, I let [the clients] lead.”
- Check in monthly. “I simply ask ‘How are you doing?’ or ‘Do you understand your statement?’” says Riney Smith. “Those questions then lead to deeper conversations about how [clients] are feeling about their money.” When she can, Riney Smith tries to help out in ways clients don’t typically expect. For example, she hosted a cocktail party and dinner for a client’s widow group (without asking for any business).
“I knew my client needed a jump-start to reengage with friends,” Riney Smith says. “And this was an
easy way for me to help. I had fun, too!”
Read more of the Fidelty report: Sudden decision makers: empowering women in transition