Insurers in the US cannot
afford to ignore the power women have in the financial decision
making process.
This is the message comes
through loud and clear in a study undertaken by not-for-profit
organisation the Insured Retirement Institute (IRI) which concludes
that female clients represent “tremendous” opportunities in the
retirement planning market.
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Emphasising the significant
role being increasingly played by women in the workplace and in
household financial affairs, IRI president and CEO Cathy
Weatherford said: “From managing a corporate bottom line, to
determining the family finances, women increasingly are the
decision makers when it comes to important financial
situations.”
Indeed, the role played by
American women is so significant that the IRI study found 95% of
all women identify themselves as being financial decision makers in
their households.
The reason for this is not
hard to find with the study noting that women comprise 46.7% of the
US workforce with 50.8% of working women employed in management or
professional occupations.
More than a quarter (25.9%)
of women earn more than their husbands while, in addition, women
represent nearly half of all individuals with at least $500,000 in
investable assets
But despite the position of
women in the workplace and in households, the IRI found that as
they look toward their retirement, women are less confident, citing
concerns about outliving their retirement savings.
On this finding, Weatherford
said: “Financial professionals have an opportunity to address this
retirement apprehension, but they need to consider the unique
priorities women have when selecting an adviser.”
Weatherford continued that
advisers when consulting with women on their retirement plans must
incorporate guaranteed retirement income strategies within a
retirement plan.
In doing so, advisors can
help address the potential retirement shortfalls that face even the
most affluent women, she stressed.
The IRI study revealed a
number of other important points, including:
- Women are increasingly open
to receiving assistance from financial professionals, with 50%
saying they need help in some areas of managing their finances, up
from 33% in 2004; - Women tend to prefer
qualitative means when selecting a financial adviser, with 61%
citing a feeling of trust and respect as the top
factor; - Between 80% and 90% of women
place a high value on income, principal or investment guarantees
during retirement, opening up the adviser/client discussion of
retirement income solutions that incorporate annuities as an
element; and - Average life expectancies of
women are about three to four years longer than those of men,
leading to increased costs of living in retirement, most notably
long-term care, on retirement incomes that are between 56% and 82%
of those of that of their male counterparts.
Notably, the IRI’s study also
revealed that although women continue to earn less than men, their
salaries are increasing at a greater rate, thereby closing the
earnings gap between genders.
Specifically, on average, full-time, salaried women
workers earned 79% of the income of their male counterparts in
2008, compared to 76% 10 years earlier and 70% 20 years
earlier.
