Women control more private wealth than ever before.
Today, women control 1/3 of US household investment assets and 51%, of all personal wealth in the US. Women are poised to control a majority of the investment assets as well.
In fact, some financial experts predict that women’s control over personal wealth will increase 30% to $29 Trillion over the next 40 years. Others think the shift will occur prior to 2030.
How is wealth shifting to women?
Women tend to be younger than their partners and live longer. Women are also increasingly business owners, entrepreneurs, and the family’s primary or sole breadwinners:
- There are approximately 10.6 Million women-owned businesses in the United States – and women are responsible for 70% of all new business startups in the United States.
- In families that have a husband and wife, 40% of wives now make more than their husbands.
- Two out of three women over 75 are single – many due to the death of spouse, as women frequently outlive their husbands.
- 70 percent of investment assets and 57% of all wealth is held by baby boomers. About 10,000 boomers turn 65 each day.
The Great Wealth Transfer is coming
In the next 25 years, it is anticipated that 45 Million families in the U.S. will transfer somewhere between $59 Trillion and $68 Trillion from the Baby Boomer generation to the next generations. Because women tend to be younger and live longer than their partners, most of the private wealth that changes hands in the next few years is likely to go to women before it transfers to the next generation.
Yet, the wealth management industry has historically focused on male clients. Perhaps that is why many women do not engage in financial planning or wealth management. Interestingly, however, of women who increased their involvement in their financial affairs, 90% reported an increase in their quality of life. It is empowering to take control over your finances. Seek out one who is a good fit for you.
Estate planning lawyers have similarly catered to males. Not surprisingly, studies show that 70% of widows change their estate planning attorney after the death of their husband. I see this frequently in my estate planning practice with many widows choosing to move their business to my firm. Often because they want to work with a woman-owned firm. Just as frequently, it is because we treat them with dignity and do not assume they lack sophistication simply because they are women.
In Closing
The shift in wealth is in process. From one generation to the next. And women stand to benefit greatly over the next few decades. For women, having a plan to manage our wealth and to protect our legacy is critically important. Part of protecting our legacy is ensuring that our money supports the people we love and the causes we are passionate about. Once you have hired that wealth management or financial planning professional, you can work with them to see how best to grow and preserve wealth for your children and how to best support the charities that align with your values. Then turn to your estate planning lawyer to help you make sure that your wealth transfers seamlessly to the next generation and that the charities you currently support are not forgotten.
Resources:
Blog Post: Leveling the Playing Field
by: Boston Consulting Group
- https://www.bcg.com/documents/file56704.pdf
- https://www.mckinsey.com/industries/financial-services/our-insights/women-as-the-next-wave-of-growth-in-us-wealth-management#
- https://www.fa-mag.com/news/women-need-to-lead-in-finances–consultant-says-54850.html
- https://www.investmentnews.com/the-future-of-wealth-management-is-female-195567
- https://finance.yahoo.com/news/great-wealth-transfer-means-economy-233527772.html
Rebecca Mason Law Estate Planning:
https://rebeccamasonlaw.com/our-practice/estate-planning-estate-administration/