Women: The Untapped Opportunity

Women Empowerment is the talk of the day. Women are moving out of their veils and standing up for themselves. Every other post on Social Media is about women, people are fighting for women’s rights, for according them the stature they deserve. Feminism is in the Air.

And amidst the commotion, there is a clue for us Advisors, this is the future, get your act together, because financial independence is a crucial aspect of Women Empowerment. Diversify Your Client Portfolio, start getting women onboard. We can see the future, the rise of women, and therefore the rise of our business lies in the obvious.

Many advisors have only a negligible percentage of women in their client base. This is because despite all the propaganda, there are some old school myths attached with “Women and finances”.

Myths

• Women do not understand Savings and Investment
• Women are not interested in Financial Planning
• Women do not have money for Investing
• Women do not have a say in family financial matters

While in the present scenario, these myths do not hold true. For better understanding, let's categorize women investors into two: The Working Women and The Housewife

The Working Woman

This category of women is consistently on the increase. With greater education, exposure and acceptance, the participation of women in both businesses and as employees, is on the upturn. And it's not just about the number, women are securing meaningful roles in organizations, and corresponding are their salaries. So, this category of women has some peculiar traits which are relevant in this context.

• They have a regular inflow of money: That goes unsaid, the most important factor of why you should target working women is their regular income.
• The primary responsibility of bringing the bread into the house is generally not on their shoulders: In many cases, working women have a lot of disposable income because they are generally not the sole earning member of the family. They do play a supporting role, the acuteness varies from case to case. It is also increasingly seen that many women work for their financial independence and to keep themselves occupied.

With money coming in every month and lesser obligatory expenses, it's easier for women to start carving out for SIPs. They might have some existing savings and investments, which can be directed towards the right products.

• High Discretionary Expenses: Working women generally have high discretionary and lifestyle expenses, which is a bi-product of the above two characteristics.
  There is scope for a lot of these expenses to be chalked off and be directed towards savings and investing.
• Huge balances in Saving Accounts: Because of regular and high disposable incomes and also because the inherent quality of saving is present in most women, they have huge saving account balances, irrespective of the discretionary expenses.
  These huge balances deserve a better return than Savings Account, so some portion of these savings shall go into into Liquid Funds for immediate needs, while the rest should be allocated to products with a high return potential, to fulfill her various short and long term goals.
• Exposure: Since they stepped out of the house, they have seen the world around, they understand the risks. And they do realize the importance of securing a safe financial future for themselves and their family. Such women need the right guidance, they do realize the importance, they just need the right direction, the right financial planning.

The Housewife

The other category of women, the Housewife. Although the housewife, does not have a monthly running income, yet her investing capability should not be underestimated.

• She's a housewife, doesn't mean she's broke: She might not get a salary every month, but she has her savings. Saving of a housewife can range from tens of thousands to tens of lakhs. We all have seen the show during the demonetization phase, many tales of domestic treasures unveiled were revealed. Though the tales were taken lightly, in fact served as comic content for Facebook pages and WhatsApp groups. But these stories have brought an important business lesson for us, Don't estimate the power of a housewife. She might have immense riches buried in the secret corners of her house.
• With greater digitization, women who earlier were not able to get out of their houses for work for their family commitments, are also venturing out into online businesses. They get the liberty to work from their homes and there is inflow of money which is largely being stacked up in their saving accounts.

So, you need to drag the housewife's money from their cupboards and their saving accounts and direct them into more productive avenues.

• She's not earning, but she has the power to influence her family's financial decisions: She understand the financial needs of her family, she has shared goals with her husband of buying their dream home, providing for their kids education, their marriage, a happy retirement, etc. And therefore, she has a major role to play in deciding how to go about planning for achieving those goals. So, it is not necessary that you approach the working spouse for investing, it can work well the other way round also.

So, the bottomline is, Women pose a big business opportunity for us Advisors. We need to understand and explore the potential and grow our business. We need to look ahead, the future of the India will not just be steered by its men, the entire country has joined its hands together, we too should join hands in the movement by empowering our ladies financially.