A recent report from McKinsey has highlighted that women are set to inherit roughly $11 trillion out of the more than $30 trillion in wealth transferred from prior generations by 2030. This has prompted the wealth management industry to focus on reaching this demographic as women already control $10 trillion in total US household financial assets. The need to prepare daughters and granddaughters to be good stewards of family wealth has become crucial in light of these staggering figures.
Many young women feel intimidated and undermined in group environments when it comes to financial discussions, as studies have shown that they fear being judged harshly and perceived as less competent when they speak up. This lack of confidence is evident in surveys where a majority of women feel responsible for their finances but lack the confidence to take on this role. Without proper guidance and advice, many women set to inherit wealth feel unprepared to manage their finances effectively.
Empowering young women to take control of their finances requires involving them early and often in financial discussions. Building confidence through education and hands-on experiences can help counteract the confidence drop that many girls experience as they mature. Encouraging young women to research wealth management topics, identify investment opportunities, and support local businesses can help them gain the knowledge and skills needed to make informed financial decisions.
Connecting young women with peers who share similar financial goals can also be beneficial in boosting their financial literacy and confidence. Organizations such as Invest in Girls and Girls Who Invest offer classes, internships, and networking opportunities for women to expand their financial knowledge and increase their participation in investing. Female mentors in the wealth management industry can also play a crucial role in guiding young women and providing them with insights and experiences in managing finances.
It is essential for the wealth management industry to address the learning and confidence disparities among young women to ensure that they are prepared to handle the vast financial power that will be transferred to the next generation. By involving young women early in financial discussions, empowering them with individual responsibilities, connecting them with peers and female mentors, the industry can help bridge the gap and ensure that daughters are an active part of the conversation regarding family wealth. Ultimately, empowering young women to take control of their financial futures is not only beneficial for them but also for the overall wealth management industry.
