There are many economic and societal impacts to be expected as we continue to see a large transformation of wealth management to the hands of women, The National Association of Women Business Owners stated in 2017 that women control 52% of overall wealth in America–a number which is expected to grow to an estimated twothirds by 2030. Adding to that statistic, The Boston Consulting Group concluded that women are adding to their assets a rate of $5 trillion per year globally, demonstrating the large responsibility that women have to manage wealth and increase their financial control to impact the various areas they see fit. This large shift of financial control to women will largely influence societal issues, philanthropic organizations, and precipitate a need for more balanced approaches to familial financial planning.
RBC Wealth Management reports that approximately two-thirds of women see an opportunity to influence societal issues through impact investing, compared to 56% of men. Women are more likely to view their wealth as a way to make a positive impact on society, even more so as Millennials move into positions of more financial prosperity. Generationally, Millennials are more societal and philanthropically aware, looking to positively impact the world around them. Women are also more likely than men to utilize their wealth to give back to charitable organizations, keeping contributions top of mind as they build financial strategies.
A rise in female-led businesses has driven a larger amount of female executives (read more here) and thus the management of wealth by these women. This is only expected to grow in the coming decades, presenting even more opportunities for women to make impactful financial decisions. The inclusion of a trusted advisor to guide and support women in these financial endeavors will be key to building a financial planning strategy that is a balanced fit.
With an increase in financial control to women, there is a greater opportunity for contribution when it comes to familial planning, elder parents, and the transfer of generational wealth. As women gain more financial independence and control, they will be able to manage their finances more effectively and in accordance with various familial goals. As eventually many women find themselves in the position of planning care for their elderly parents, the inclusion of financial context into the process removes friction when it comes to financial planning. This ultimately leads to an even greater transfer of generational wealth into the hands of women in the coming years.
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