As women gain greater financial confidence and independence, there is a significant opportunity for the financial services industry to help women grow and manage their wealth, says ING Direct.
The 2015 ING Direct Women & Finance Report found that while the pool of wealth accessible to women will significantly deepen, the industry is failing to meet their needs.
Report author and ING Direct executive director of customer delivery, Lisa Claes, said that in order for the industry to capitalise, change is needed.
Ms Claes said that approximately 27 per cent of women make a majority of financial decisions in their household, including 8 per cent who are the sole decision makers. Only 1 per cent of women make no financial decisions.
Women are also set to be the main beneficiaries of intergenerational wealth transfer, with baby boomers expected to hand down $2.4 trillion.
“The opportunity for women is how to best manage this intergenerational wealth transfer, continue building it, and ultimately pass it on to the next generation,” said Ms Claes.
However, the report found not only that the financial services industry caters to men rather than women but also that it fails to realise that women invest differently from men.
Women are more conservative investors, for example, and tend to prefer cash and balanced investment options.
“While there is debate as to the catalyst for such conservatism — whether it is hard wired or a ‘default’ approach due to financial services failing to address female engagement drivers — it is still fair to say that the industry has been relatively slow and ineffective at adapting and developing products and services that meet the needs of women as well as men,” Ms Claes said.
“It has considerable work to do if it hopes to capitalise on the growing economic power of women,” she said.
According to the report, only 31 per cent of women receive financial advice even though they are interested in wealth management and investing.
Ms Claes argued that the best way to benefit from the increasing economic power of women is to include them.
“With the aim of capitalising upon the explosive increase in their economic power, financial services companies should look to hire more female product developers, marketers and creative directors into senior positions,” she said.
“To increase appeal, organisations will need systems that can communicate more regularly, pro-actively and of course, digitally.
"A realisation that sometimes the best solution isn’t the one which delivers the highest investment return is also important," Ms Claes said. "Women do value strong investment performance but equally place significant value on the intangibles of consistency and security."
A coalition of Australian financial services providers, insurers and scientists has rolled out new standards for physical risk assessment fr...