Women: An Evolving Demographic

No longer a niche, they’re approaching the lead as household earners;
and the best candidates to advise other women

By Becky Ferguson

Ms. Ferguson is Senior Life Marketing Consultant with Ash Brokerage, Indianapolis. With more than 12 years experience in life insurance and annuities, she specializes in building agent relationships and helping them find solutions for their clients while staying up-to-date on product and industry changes. Becky is a 2000 graduate of Indiana University’s Kelly School of Business; in addition to Series 6 and 63, she also has her life and health license. Connect with her by e-mail: becky.ferguson@ashbrokerage.com

In the last 100 years, women have made significant progress in many areas.  They have stepped out of the shadows of their male counterparts and into more prominent roles, especially within the workplace.  Even though the shift began in the early 20th century, it has just really started growing within the last 40-50 years.

Women’s imprint on history has been making larger impressions over time.  In 1920, the 19th Amendment to the Constitution was signed into law granting women the right to vote.  As women took up a larger share of the workforce, Congress was faced with passing the Equal Pay Act making it illegal for employers to pay a man more than a woman for the same job.  In 1969, California was the first state to adopt a no-fault divorce law, and by 1985 every state had followed suit.  Although these milestones granted women new freedoms, they also created a new type of customer.

Women now make up roughly half the U.S. Workforce1

  • From 1970 to 2013, their average incomes increased by 91 percent 2
  • According to the U.S. Bureau of Labor, more than one-third of wives earn more money than their husbands, and this number continues to grow
  • Even though many women out-earn their husbands today, fair pay is not fully spread across the genders with the average woman earning $.77 to each $1 of men’s wages3
  • These are educated, empowered and successful women who run companies, as well as households

A woman who is the head of a household and financially supports her family is becoming more common.  As an advisor meeting with a couple, it’s helpful for you to be aware of where women have come from as well as the planning projections that directly affect their retirement needs.  Money behaviors are built on historical events that include the type of environment a female was raised in and where she obtained her financial literacy information and understanding any fears she has regarding planning.

Working with advisors on a daily basis, I find a majority of my insurance-related calls deal with married couples.  And, even though we have established laws to distribute equality across both genders, males continue to be insured at significantly higher amounts than females.  Amazingly, many women are not insured at all when, in today’s economy, most households are dual-income families.  Life insurance on a woman can replace not only lost income, but can also provide funds for others in the family affected by her absence (such as child-related expenses like daycare and college tuition), help maintain the family’s quality of living or replace any caregiving needed for an aging family member.

Life insurance is especially important to single mothers. Whether they have always been the sole income and care provider, or share this responsibility jointly with another parent, it is important to make sure the female client understands her income will be missed should she die without having a plan in place.  In addition to life insurance needs, introducing the client to other planning concepts is necessary, including establishing a will and trust to orchestrate how the proceeds should be used. In addition to the financial aspect, a living will can be established at the same time to prevent a child or close relative from having to make decisions that may never have been discussed.

Don’t avoid the topic of wages

The topic of wages can be sensitive with women, but you need to inquire so you can set them up for a successful outcome.  Not asking about earned wages outside income sources (such as annuities, gifts, child-support, etc.) will hinder the planning process. Income replacement must be discussed.  Many women are afraid of outliving their retirement income.The Centers for Disease Control and Prevention found the female life expectancy is currently at 81.1 years. Women need to plan for longer lives!

With fewer employers offering pension plans, saving for retirement is key; this includes females working in and out of the home.  One option could be to open an IRA account.  In 2013, if the spouse’s income supports the limits, she will be able to contribute $5,500 (or $6,500 if she is age 50 or older).  For those women who are employed outside the home, help her examine the details of the retirement plan offered at her place of employment, and see where opportunities might lie.

Many companies match contributions, which the employee may not even be aware of … that’s money they are missing out on.  This can also lead to an opportunity to move her out of an old retirement plan and into a new vehicle that is more advantageous to her retirement needs.  Encourage her to not only save to IRAs and retirement plans, but also to a general savings account; easy savings sources are tax refunds and bonuses.

The Importance of Long Term Care

By taking the time to learn and understand more about your female clients, you will more easily recognize what is meaningful to her and what influences her financial behavior. Building connected relationships (partnerships), as well as taking in the background information provided here, will enable you to provide assistance by uncovering what is missing from her financial portfolio

Another area to consider planning for is long-term care.  While many women contribute to the majority of child raising, we also found they do the majority of caregiving for elderly family members.  For example, the typical U.S. caregiver is a 46-year-old woman who works outside the home and spends more than 20 hours per week providing unpaid care.4 It’s important these family members feel they will be taken care of should anything happen to their female caregiver.  Long-term care insurance or hybrid life/LTC policies can protect the female clients’ retirement savings, as well as provide the financial means for their care when the time comes.

Knowing how to relate this information to a female client is the most important aspect in the advisor-client relationship.  When looking into their financial future, it is best to understand the differences between women and men.  Prudential Financial has published their 2012-2013 research on “Financial Experience and Behaviors Among Women Study.”  In this study, the differences between women and men are spelled out on main topic points from their income and savings to their priorities, knowledge and worries about their financial future. 5

MAJOR FINDINGS – Differences between women and men

Median income$51,000$57,000
Median savings$12,400$40,500
Top 3 Financial PrioritiesNot become a financial burden to loved onesMaintain lifestyle in retirementMake sure not to outlive savingsMaintain lifestyle in retirementMake sure not to outlive savingsNot become a financial burden to loved ones
Top 3 Financial WorriesHousehold expensesHousehold debtSaving for retirementThe overall economyHousehold expensesSaving for retirement
Knowledge of Financial Products5% Very knowledgeable49% Somewhat knowledgeable32# Not very knowledgeable13% Not at all knowledgeable14% Very knowledgeable57% Somewhat knowledgeable22% Not very knowledgeable8% Not at all knowledgeable
Current Economic Standing20% Doing well or ‘upscale’43% Doing OK or ‘adequate’37% Struggling to make ends meet or falling behind on bills29% Doing well or ‘upscale’37% Doing OK or ‘adequate’34% Struggling to make ends meet or falling behind on bills
Confidence in Financial Decision Making22% Very well prepared63% Need help or need to catch up in many areas15% Are self-described ‘beginners’37% Very well prepared57% Need help or need to catch up in many areas7% Are self-described ‘beginners’
Risk Tolerance49% Willing to take a risk for the opportunity of a greater financial reward22% ‘Enjoy’ investing70% Willing to take a risk for the opportunity of a greater financial reward40% ‘Enjoy’ investing


As the chart shows, even though women make roughly 11 percent less than men, their savings are significantly different – 70 percent less than men.  However, their financial priorities are similar, which underscores the need for more education about how to achieve their goals.  Selling financial services to men is markedly different than selling financial services to women.

So, what does this mean for you? And, more importantly, how can you use it to become a better producer? Changing the way you relate to your women clients will benefit your productivity in more ways than one. During your fact-finding, address each of their top worries of expenses, debt and savings using a more rapport-style questioning to connect with a woman prospect’s heart.

By taking the time to learn and understand more about your female clients, you will more easily recognize what is meaningful to her and what influences her financial behavior. Building connected relationships (partnerships), as well as taking in the background information provided here, will enable you to provide assistance by uncovering what is missing from her financial portfolio.

Understanding the differences will provide you with the opportunity to fill gaps and bring solutions to the table that will make her life simpler, and ensure her financial future is worry-free.  The reality is, what you’re providing is financial help and trust … and, if she’s impressed with your help, you can trust her to tell her friends and colleagues.
1    “Pay Equity is Good for Business and Good for Working Women” report, Business and Professional Women’s Foundation, March 2010
2    “Women Invest“ White Paper, LPL Financial
3    “Pay Equity is Good for Business and Good for Working Women” report
4    National Alliance for Caregiving and AARP, Caregiving in the U.S., April 2004
5    Prudential’s 2012 Financial Experience and Behaviors Among Women Study