The Future of Finance is Female

10 min read
January 29, 2019

The Future of Finance is Female


The Future of Finance is Female, by Ben Henry-Moreland

There was a some grumbling in the financial media world recently (which I pay attention to so you don’t have to) about a New York Times op-ed by investment advisor and blogger Blair duQuesnay, titled “Consider Firing Your Male Broker”. Provocative headline notwithstanding (duQuesnay says it was the Times‘ creation), the main message of the piece is that women are being denied (or driven away from) opportunities in the financial industry despite evidence that they meet their clients’ needs at least as well as, or better than, the men who run it as a boys’ club.

I didn’t find anything particularly controversial about the article. Both the evidence (the piece states that fewer than 20% of all investment advisors are women) and my own experience in the industry have shown me that women need more and better career opportunities here. Financial advisors affect the well-being of millions of lives, yet I wouldn’t trust most of them to take care of my houseplants over a long weekend, much less my savings for retirement. Bringing in more of the best women to replace the worst of the men will raise the bar for everyone.

Unfortunately, because this was a woman writing about sexism in a national publication, plenty of men were eager to point out to duQuesnay all of the ways in which she was wrong. Many shared anecdotes of awful experiences with a female broker. Others, perhaps triggered by the headline, accused her of being just as sexist as the industry she was describing. Some criticism from people who actually read the article fixated on research duQuesnay cited suggesting female investors outperform their male peers simply by trading less and incurring fewer costs. While it’s true that a handful of studies doesn’t prove conclusively that women are better investors than men, to make that argument is to completely miss the point of the article and in a way it validates duQuesnay’s message about the state of the financial industry today.

The history of financial advice is indisputably male. This is baked into the term “financial advisor” itself: for decades, financial advisors sold financial products (usually mutual funds, life insurance, or annuities) and were paid on commission. Imagine a car salesman calling himself a “transportation advisor” and you get an idea of how ridiculous that is. Pressure from corporate overlords, competition from other salesmen, and plain old greed led to aggressive sales practices that ignored what the customer needed in favor of what they could be convinced to buy. Unlike law and medicine, two other historically male-dominated professions that nevertheless enforce uniform standards of duty to their clients, finance kicked hard against any efforts to protect the people it served. As a result it became the bastion of the alpha male: loud, overconfident, and single-mindedly obsessed with winning.

Plenty of people in the financial industry – particularly those who have worked in it for over 10 years – still view it through the lens of the old model. But ever so slowly, the model is changing.

One of the first people to crack open the door to a different kind of financial advice was John C. Bogle, who died at age 89. Bogle dispensed with the notion that mutual fund managers were worth the high fees they brazenly commanded, and developed the low-cost index funds that anchor many investors’ portfolios today. His company, Vanguard, also allowed investors to buy shares of its funds directly, eliminating the need for a commission-seeking broker as a middle man.

The door opened a little wider as advisors began offering fee-only financial advice, free of the conflicts of interest that entangle commission-based salesmen. Industry regulators have proposed enforcing higher standards of duty on people who call themselves financial advisors, though that effort has stalled under the Trump administration. The powerful dudes on Wall Street will continue to fight it, but the industry is slowly progressing away from the alpha-males toward a fiduciary model, where the clients’ interests come before all others.

The future of financial advice is more empathetic, conscientious, and interested in the well-being of others. That is to say, it’s more female. Whether or not a fiduciary standard becomes the law, the shift is happening because it’s what the public wants. Women have traditionally made the majority of household financial decisions, even before they started earning a significant share of household income. They used to have little choice over whom they could turn to for financial advice; now that they do, the age of the overtalking alpha bro selling shoddy life insurance as a “financial plan” will rapidly fade. And the question “do I want a man or a woman to manage my IRA?” will become “does this man or woman care more about my life goals or their sales goals?”

Just as finance’s alpha-male problem was self-reinforcing – the atmosphere was so toxic that women who might have overcome the obstacles to getting hired chose other careers instead – the shift away from that model could also have cascading effects. A career of helping people become financially secure or reach their long-term goals is more attractive for some people than one taking vulnerable marks for all they’re worth. Those people aren’t all women – I count myself among them – but I’d be willing to bet that group is much more representative of the general population than the industry’s historical makeup.

The shift I’m talking about isn’t going to automatically make life better for women in the financial industry. Despite the industry’s changes in the last two decades, the ratio of female advisors still hovers around 1 in 5, and the gender pay gap for financial advisors is one of the worst of all professions. As duQuesnay wrote in her piece, “women need institutional advocacy, not just someone who is willing to grab a cup of coffee and chat.” But women and men who can deliver real financial advice will be more in demand, and they’ll be the ones who pull the industry out the alpha-male swamp it’s been wallowing in.

If you think that picking a financial advisor is about who has gaudier investment statistics or who can sell you a better investment product, know that there’s a different way to get financial advice that’s about what your needs are. Look at NAPFA or XY Planning Network to find an advisor who puts your interests first. And if you do decide – after all this – to fire your male broker, don’t feel too bad about it. As long as we’re in America, there will always be a job for another car salesman.


Ben Henry-MorelandAbout the Authors
Ben Henry-Moreland is a CERTIFIED FINANCIAL PLANNER™ professional in Omaha, Nebraska and the founder of Freelance Financial Planning. A former professional opera singer, he now works to help freelancers, contractors, and entrepreneurs take the next step toward building financial security. He writes about financial planning matters for self-employed professionals and the future of the independent workforce.






Jason SpecinerJason Speciner is a CERTIFIED FINANCIAL PLANNER™ professional, an Enrolled Agent, and the founder of fee-only firm Financial Planning Fort Collins. He is also a member of the National Association of Personal Financial Advisors (NAPFA), Financial Planning Association® (FPA®), and XY Planning Network. Since 2004, he has served clients of all ages and backgrounds with unique experience working with members of generations X and Y.







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