Why did we do this research?

While females control 51% of the personal wealth in the U.S., they represent only 32% of the financial advisor population. If individuals prefer to work with teams that include both women and men, the industry would benefit by redoubling efforts to attract and recruit female financial advisors.

Why is this research important?

Given the underrepresentation of female advisors and growing percentage of women controlling wealth in the U.S., this research sought to address the question of whether gender plays a role in the selection of a financial advisor. Using an online survey instrument, 1,011 were asked to choose between a financial planner or an investment adviser. For half the sample, the financial planner was male, and the investment advisor was female. The gender assignments were reversed for the other half of the sample.

What did we learn?

Our results found no evidence of gender bias. Male respondents did not prefer male advisors, and female respondents did not prefer female advisors. We did find, however, that female respondents had a strong preference to work with a financial planner (vs. an investment advisor), regardless of the advisor’s gender. Respondents of both genders also indicated a strong preference to work with teams, rather than solo practitioners, and preferred that the team have both male and female leadership.

What are the takeaways for clients?

Advisors who have been narrowing their marketing efforts to target same-gender prospects might wish to reconsider this strategy and broaden their outreach. In addition, given female preferences for a financial planning approach, advisors should reassess their practices’ capabilities to ensure these services are being offered. Finally, teams should strive to incorporate members with diverse background and experiences.

Source: Sommer, M., Lim, H., & MacDonald, M. (2018). Gender bias and practice profiles in the selection of a financial adviser. Journal of Financial Planning, 31(10), 38-47.