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Why recruiting alone won’t boost number of women advisors

One of the major challenges facing our industry is rooting out sexual harassment and sexual discrimination in the financial planning industry. Indeed, I’ve written before about the need to ensure that the top ranks of management are open to the many qualified women who have already proven their leadership abilities.

But simply getting more women into positions of leadership and influence is not enough. We need to do more to encourage young women to enter the profession. After all, these young planners are the best source for the energy, innovative ideas, and future thinking that our profession — or any profession — needs to survive and thrive. The more young women we can encourage to enter the financial planning workforce — and nurture their growth once they are onboard — the better positioned our industry will be for the demands of the future.

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I have found deep fulfillment in providing a more nurturing environment than the one that greeted me when I was starting out several decades ago.

There are some encouraging signs that more opportunities are opening for young women considering careers in financial planning. For example, though only about 18% of Chartered Financial Analysts are women, according to a recent report by the CFA Institute, the organization is currently in the midst of a major recruitment push called the Women in Investment Management Initiative.

Similarly, the CFP Board of Standards is rolling out its own effort to raise the ratio of women CFPs from 23%, where it has stagnated for much of the past decade. Its WIN-to-WIN program aims to provide mentorship and support to women entering the profession and seeking CFP certification.

Such efforts are timely in several ways. First of all, women earned nearly 60% of all bachelor’s degrees granted in 2016, including about half of all business degrees, according to data from the Department of Education and College Factual, a higher education research firm.

Young women coming out of college are not only seeking opportunity, they are highly qualified for it. Meanwhile, the financial planning industry is positioning itself for visibility — an essential prerequisite for attracting the most promising candidates.

There are some encouraging signs that more opportunities are opening for young women considering careers in financial planning. Even though only about 18% of CFAs are women, according to a recent report by the CFA Institute, but the organization is currently in the midst of a major recruitment push.

Second, indications are that women will overtake men as holders of wealth in the United States sometime during this decade, according to reports by the Nielsen organization and others. With more and more wealth being concentrated in the hands of women, it makes more sense than ever for our industry to focus on attracting the best and brightest young women who are both deeply grounded in professional acumen and acutely attuned to the needs of the women who will increasingly make up our clientele in the coming years.

A 2013 study by the Insured Retirement Institute found that 70% of women seeking an advisor preferred to work with another woman. But as recently as 2017, only 16% of financial planners are female, according to a survey by Cerulli Associates.

That means that it is really tough for women investors—a growing demographic—to find a qualified financial planner who is a woman. It seems evident that there is a big gap in our ranks that needs to be filled if we intend to remain relevant, competitive, and attractive to those who will most need our services.

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Finally, many women tend to excel in the “soft skills” that will be increasingly important to our clientele: listening, empathy, and active engagement with clients to establish goals and priorities.

We can’t afford to allow our efforts to stop with recruitment, of course. We need to provide mentoring, coaching, and above all, a clear and attractive career path for the young women entering our profession. We need to help them see the long-term possibilities for enjoying careers that are uniquely suited to both their professional and personal aspirations. Many women are looking for ways to build a meaningful career that doesn’t require them to sacrifice other life goals that are equally important.

Our industry is well-positioned to provide such opportunities for young women with the talent, commitment, and vision to reach for them. For example, leading my own wealth management firm affords me the flexibility to go to my son’s baseball games, attend school events, and involve myself in other ways with my family and community without the necessity of compromising my commitment to my practice. Other women report achieving similar satisfaction in work/life balance while contributing pivotally as asset managers, financial planners, or investment advisors.

Photo by Scott Wenger

I can also say, from first-hand experience, that one of the most satisfying things for me over the past several years, as a seasoned financial planner and head of my own firm, has been to foster the growth and success of several outstanding young women in this profession that I have grown to love. Especially given my background and my own experiences as a woman in the industry, I have found deep fulfillment in providing a more nurturing environment than the one that greeted me when I was starting out several decades ago.

I would strongly encourage my senior colleagues, both male and female, to commit to “paying it forward” for the financial planning industry by helping to create a better, more welcoming environment, especially for the young women who are so vital to our future. The results will reach far beyond the immediate benefits for those young professionals entering the business. Our profession will be much the stronger, and those of us who put in the time and effort in nurturing them will receive dividends — in giving back to the industry, in personal satisfaction, and, I believe, in the growth and success of our own firms — that far outweigh our investment.

Indeed, it is essential for us to get the word out that our business isn’t just about the big brokerage firms anymore. Over the last 10 years, we have seen tremendous growth in the variety of opportunities and paths to success that are available. Nevertheless, we are still suffering in our efforts to recruit women because of the long-established stereotype that investment is a men’s game, dominated by the name-brand Wall Street firms.

The more that we can exemplify and model the success that is available to women in our industry, and the more we can point to the diverse ways women are achieving that success, the better our chances of not only recruiting but also retaining more young women as financial advisors and planners. Our ability to do that is more than just a good idea; I believe it is essential to maintaining the relevance of financial planning in the coming years.

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