Bridging the Gap: Women Shaping their Futures… with Finance | Ultra High Net Worth Women — Leading the Charge

There is one group of women leading the charge to bridging the wealth gap: wealthy women. This group is on the rise due to shifts in global wealth distribution, changing cultural attitudes, the growth of female leadership and entrepreneurship, and intergenerational wealth transfers. 

A massive amount of assets will be moved into the hands of US women over the next three to five years, representing a $30 trillion opportunity for the wealth management industry by 2030. For the first time in history, there is a blossoming group of UHNW women that will hopefully only increase as we equip more women with the knowledge they need to grow their wealth. Who is defined as UHNW? An individual who owns more than $1 million in liquid assets. Women only account for 11% of the world’s UHNW population with an average age of 63.6. 

How did women get this money and where is it?

In 2024, self-made women are creating their fortunes from a myriad of industries from books to biometrics. Forbes America’s Richest Self-Made Women highlights that the oldest self-made billionaire is Alice Schwartz, 96, who co-founded Bio-Rad Laboratories, a healthcare research lab created to accelerate diagnostics, with her husband. Diane Hendricks, who owns a roofing and building supply distribution company, is No. 1 for the sixth year in a row with a $15 billion fortune.

45% of UHNW women have self-created fortunes (compared to 75% of UHNW men), 25% of them attained their wealth purely through inheritance, and the remaining 30% achieved their status through a combination of inheritance and self-creation. Interestingly, the median wealth for women is $4 million higher than for men (67 vs. 63 million).

UHNW women allocate their wealth across liquid assets and private and public holdings. However, women hold 3x as much of their wealth in real estate and luxury assets as opposed to men. Within this, women account for 70% of UHNW owners of luxury watches and jewelry. 

What unique perspectives do women bring to investing?

Women are more disciplined and calculated in their investment approach; whereas, overconfidence in men causes them to trade 45% more than women. Even so, women, who are often more risk-averse than men, achieve similar returns to men while taking significantly fewer investment risks. Perhaps, the better way to label women is “risk aware” in how they evaluate strategies for their holistic needs. 

UHNW women’s top interest or passion in comparison to men is philanthropy (60.7% women vs. 35% men). Therefore, these women invest with purpose that infuses their personal values. 49% of women believe that a company’s social mission is extremely important to them as they think about investing in it, compared to 29% of men. Women are increasingly investing in companies that prioritize ESG, diversity, equity and inclusion. 

A notable example of this tendency can be seen in Ruth Gottesman’s recent $1 billion donation to Bronx medical school, The Albert Einstein College of Medicine, to be used to cover every students’ tuition moving forward. Around 60% of the current medical students are women. When her husband died in 2022, he left her a portfolio of Berkshire Hathaway stock with the simple instructions “do whatever you think is right with it.” Because Gottesman chose to use her wealth with purpose, she is likely to propel hundreds of women through medical school, a path they could possibly not have pursued without the funding. On top of this, these women will have more capacity for building wealth as soon as they leave their program.

As UHNW invest and build their wealth, they are thinking about legacy and how to best equip the next generation of their families for success. They are attuned to trust and estate planning while at the same time instilling the idea that wealth is more than just money, but rather the ability to live a meaningful life.

Where do you speak to these women?

Regardless of how women have accumulated their fortunes, wealth managers can attend to the unique needs of these women. If you want to reach women, speak to their unique needs around being risk-aware, purpose-investing, legacy-building. Understand their gaps in knowledge and partner with them to build a portfolio that feels meaningful and designed for the long-run. They want to see personalized outreach that takes all of their priorities into account.

It’s vital to meet women in spaces that they have designed for collaboration and knowledge sharing. Female investors want to be a part of communities that amplify their experiences and struggles, and also give voice to other diverse individuals. As women grow their leadership roles, they build female-focused networking groups that fill a void for high powered networking and micro communities that address their unique professional and personal  needs., 100 Women in Finance, Financial Women’s Association, National Association for Female Executives, and Chief. These spaces create opportunities for personal relationships to be built between financial advisors and women that go beyond individual financial success. 

The key takeaway: watch the wealthy women – closely – and personalize outreach that speaks to their unique needs.

For more insights on the wealth management space, visit our new research report “Money Changes Everything: The Evolving Global Wealth Landscape 2024.”