By the time female clients find themselves sitting in Carol Idone's office, they are usually very willing to listen to advice on retirement planning. Just the very fact they are there typically indicates a major life-changing event has happened, Idone says. That usually means divorce or death of a spouse.
"Even before a client gets here, it is more likely that a man rather than a woman would walk through the door," said Idone, a financial advisor with Strategic Benefit Services in Rensselaer, NY. "It is especially less likely that women would walk in by themselves."
That is the unfortunate reality for most retirement planners because the people that may need your services the most are the ones that may be the least likely to seek them out, Idone said.
Why this disconnect? For one thing, at the risk of sounding politically incorrect, Idone said many women are not actively involved with their household finances. As a result, they do not have high "financial literacy." This is not a comfort zone for those individuals.
Equally important, the fact that a life-changing event potentially brought the client to your door means they are in a very emotional period. They may be experiencing extreme grief, depression, fear and anxiety, or combination of the above, Idone said. They may feel lost and desperate.
All of these factors mean that retirement planners really need to be on their best game when advising female clients. That means fostering a relationship of trust at the outset. And it especially requires the ability to be empathetic to the person's personal situation.
The good news here is that regardless of how the first conversation or two with these clients unfolds, they are likely to feel much better right away, Idone said.
"They come into the first meeting with nothing. They may say, 'I know I need help. I don't know what to do. Help me. By the second meeting they typically feel good. They now know the challenges they face, but they know they're doing something about them," he said,
One of the great ironies of retirement planning is that in most marriages, husbands handle most of the retirement plan details, while their wives ultimately depend on the majority of the retirement benefits.
"Women tend to outlive their husbands. Only one-third of women over sixty-five are married, and on average women will survive their husbands by 15 years," according to the Women's Institute for Financial Education. "The combination of being on their own and living longer means that women need far more retirement income than do most men."
The Financial Literacy Gap
Liz Davidson certainly needs no convincing. As president and CEO of Financial Finesse, Davidson tracks the literacy gaps between men and women when it comes to financial and retirement planning.
"There is a significant gap between men and women's financial literacy that is causing more risk for women than ever before since other factors make it even more difficult for women to retire and support themselves financially throughout their lives," Davidson wrote in a column for Think Advisor. "This year Financial Finesse's research found that not only to women continue to lag behind men when it comes to their financial literacy and knowledge, but the gap between the genders seems to be growing."