The results of a recent survey among female wealth advisors and financial planners from around the country reveals key differences in leadership styles, growth drivers and sales training.
Nearly 60% of participants mentioned “firm culture and leadership” as their top hurdle when starting as a financial advisor, according to the survey by the Carson Group conducted in collaboration with the Hidden Insights Group. The survey set out to uncover the biggest challenges women face in choosing a career as a financial advisor, as well as the opportunities available to them. Although women make up more than half the population, the study notes that only 18% of financial advisors in the U.S. were women in 2019, citing data by Cerulli Associates.
When asked about the biggest hurdles they currently face, the female financial advisors pointed to practice management and administration (55%), firm culture and leadership (45%) and selling (44%) as the top three.
The following are some of the key themes that emerged from the survey:
- Balancing the needs of career and family has led to the perception that female advisors are less committed or engaged than their male counterparts.
- The most important cultural elements that contribute to a female advisor’s success are work-life balance, empowerment and collaboration.
- Hybrid compensation models (salary plus variable) are the most attractive to women because they provide some level of financial security, especially early on, and support a team-based structure.
- Female advisors specifically called out the need for enhanced training programs that focus on relationship building, financial planning and operational excellence, as well as more intentional mentorship programs with more female leaders available to mentor.
“One of the things we learned is that women perform more effectively with a concept called ‘teaming’—a functional structure that supports and highlights each member of the team for the specialties and skillsets they bring to the client experience, rather than the more traditional practice we’ve seen for decades, where a single advisor, primarily male, is solely spearheading the direction of the firm,” notes Teri Shepherd, co-president of Carson Group.
The survey also found, however, that teaming can be challenging to implement with the default organizational chart, but female advisors articulated making it a priority because of the increased opportunity for personal development, and the ability to build an effective succession plan and deliver a more compelling client experience.
Business Growth
The importance of strong client relationships with client referrals was cited as the primary source of growth across the study. When asked about the impact of client referrals on growing their business:
- 47% said it is a cornerstone of their practice;
- 30% said it had a significant impact; and
- 20% said it had a moderate impact.
Female advisors saw their natural ability to educate as a positive in building a client base, while some cited financial workshops and seminars as a successful way of building new relationships, the study notes.
A clear value proposition coupled with a solid, repeatable sales and planning process was also cited as critical to growing their client base. Things that did not work for participants in the early stages of their careers included “call nights,” not being able to choose clients and pushy sales tactics, according to the findings.
Women are also challenged by compensation models that place a high emphasis on sales over service. “Female advisors don’t want to feel conflicted about selling products to hit certain thresholds or receive benefits, they want to be a good fiduciary and do what’s right for their clients,” the study notes.
Mentoring and Coaching
Mentoring was cited as the most helpful tactic in developing female advisors with over 55% of participants saying it was critical or had a significant impact on their development. “With so few female advisors in leadership roles compared to their male counterparts, token female leaders are often stretched too thin to mentor,” the study further observes, citing the importance of having more female leaders and role models to fill this gap.
Study participants who have hired a coach have seen it as a benefit to their overall success, with 35% of respondents saying it was critical to their development. “Women account for an increasing amount of wealth in this country, and it’s imperative that we tap their unique perspective as we reinvent the advisory profession and financial services in general,” Shepherd emphasizes.
The findings are based on a quantitative and qualitative survey of 59 female advisors who engage in a wide range of wealth management and financial planning. Participants completed a 30-question survey based on their experiences in the industry, with a majority then participating in 90-minute small, focus group sessions.
