More Women Are Making the Financial Decisions
Over the past year or so, I have heard several of my larger bank and brokerage firm clients voice interest in finding ways to engage females. There seems to be a recognition of the influence that women have on financial decisions in the household, and there is an appetite to figure out what makes them tick.
It makes sense. Females have been involved with (or driving) financial decisions for decades, and according to a recent Merrill Lynch study, married women 45 years and younger are twice as likely as older married women to make the financial decisions for their families. We all see the shifting demographics that could be driving this – women are marrying later, getting more education, and working more, and are more often the primary breadwinner for their families than they have been in the past.
Female Financial Decision-Makers Are Different From Their Male Counterparts
For banks and brokerage firms trying to understand how to connect with these decision-makers, the challenge is real. They share many of the same needs, attitudes, and behaviors with their male counterparts, but the ways they stand out are what make them more difficult to engage. While they have comparable confidence in their own abilities to manage their finances and are equally hampered by debt, females are less likely to enjoy investing, be involved with actively managing their accounts or looking for new ways to manage their money. These are all things that make them harder to engage as banking or brokerage customers.
Even as this past year has brought household finances into the forefront of our minds, women have not responded with the same engagement as men, also making it harder to attract their attention. Though the pandemic has made everyone want to watch their accounts more closely and get help planning, and the uncertainty of the past year has made them more interested in finding new ways to manage their finances, this is more true for males than females.
How to Engage the Female Demographic for Financial Decision-Making
With the differences that exist, what is a bank or investment firm to do to engage women with their services? The short answer is – the same things you would do to engage men. Both groups are similar on several key concerns like paying down credit card debt and better educating themselves on investment options. The long answer is to be specific by focusing on the areas of more interest for females. Females are looking for ways to improve their financial picture for the future, spending less on today and improving their credit score for tomorrow a bit more than males. Males lean a bit less into planning for the future and more into getting the most out of today.
Females may be a bit less interested and excited about thinking about managing their finances overall, but they are still often responsible for this task and need services just like males do. Interestingly, one in three adults of both groups perceive that big financial firms treat women differently than men – which may not be the perception that these firms want to work toward.
The differences between groups of financial services consumers that will make it easier for firms to engage them may not be drawn along gender lines as much as along life stage, situational or other lines that influence the specific concerns and needs that consumers have. With the differences in lifestyles for each group being less dramatic than in generations past, it stands to reason that what females need to manage their finances is not that different from males. This can be good news to banks and brokerage firms targeting these consumers, as the services and messaging that will resonate most likely crosses gender lines.