Frani Feit was happily married with two small children when tragedy struck. Her husband, David, died unexpectedly leaving her with no source of future income. She had worked in the public accounting and the actuarial/pension fields before she had children, but she knew she wanted an opportunity to control her own destiny and leverage her people skills. When asked about the “hurdles” she believed she had to address and overcome in her efforts to enter the financial advisor field, Feit said she felt intimidated by having to go out and do the “hard sell.”
“The ironic thing is that once I became comfortable with what I was doing, I realized that meeting with prospective clients wasn’t selling, but rather having a conversation,” said Feit, now a vice president of planning and investments at Summit, N.J.-based Candor Wealth Advisors. “I enjoy speaking with people and learning about their lives and dreams. I am then able to connect with them on many different levels.”
But in this industry, Feit’s story is more the exception, not the rule.
Women comprise just over half of the U. S. population but only 26 percent of the financial advisor industry, according to the Bureau of Labor Statistics. (REP.’s annual compensation survey, has a figure even lower, at about 13 percent of the industry.) Many women who would make solid advisors are either unaware of the profession or just not attracted to it for one reason or another.
Why aren’t there more women in wealth management? The CFP Board recently released a whitepaper on the topic as part of its women’s initiative. Here are the top reasons women avoid the industry:
- Business models and compensation structures may be unfair or unattractive to women.
- There is an insufficient number of role models and mentors for women.
- Work-life balance concerns may be keeping women out of the field.
- There is an inadequate understanding as to what it takes to be successful in the field—the misperception that one has to be a math whiz to succeed as an advisor.
Unfortunately, the same character traits that make women great financial advisors—being more relationship- and family-minded, being overly trusting, not prioritizing their own interests, not being more proactive about their careers, being more risk averse—can be the very impediments to their forward movement. But what do women have to do to overcome these barriers? Here are some thoughts:
Looking for perfection: All too often, in search of perfection, women opt to stay complacent instead of seeking an opportunity that might be a better fit in terms of culture, long-term goals, compensation and client service model. Believing that she is entitled to serve her clients in an environment that fosters fairness, creativity, growth and autonomy is a good start.
Competing priorities: Family responsibilities must always trump professional ones, but there are ways to strike a better balance. Often smaller, independent firms can be great options for someone looking for flexible hours or the ability to work from home.
Risk averse: Because women are generally more risk averse than their male counterparts, the traditional commission structure tends to scare away many potential female recruits. A firm that offers a guaranteed salary/bonus that could eventually morph into a commission-based structure as the advisor matures could be an option.
Lack of proactivity: Women often wait until there is a sense of urgency or tangible impact on their ability to service clients before considering alternate career options. Rather than being reactive and waiting to lose a client (or the threat of client loss), being proactive and knowing your options is smart.
Despite the external and internal challenges women face when contemplating joining the ranks of financial advisors and planners, the landscape of possibilities is vast, the incentives incredibly rich, and the possibility to create a work-life balance and professional life has never been greater.
Mindy Diamond is President & CEO of Diamond Consultants in Chester, NJ, a nationally recognized boutique search and consulting firm in the financial services industry.