In the coming years, the wealth management industry is expected to undergo major disruption. More than $100 trillion will be passed down, largely from baby boomers to NextGen and women. This historic "Great Wealth Transfer" presents a tremendous opportunity for the industry but also poses significant challenges, especially for traditional firms grappling with evolving client expectations. Success will require a deep understanding of the distinct financial needs, preferences, and behaviors of NextGen and female clients. By tailoring offerings and adopting a structured approach, firms can better engage and serve these key client segments.
The rise of women in investment
By 2030, women are projected to control more than half of global wealth, up from a third today. This shift is already influencing the demand for financial products and services. Women are twice as likely as men to prioritize impact-driven investments, according to Citi’s former Global Head of Private Bank for nearly two decades. This means the wealth management industry must adapt to meet the growing demand for purpose-driven portfolios that align with the values and priorities of this new generation of investors.
The role of diversity data in shaping investment strategies
Understanding the preferences and needs of women and NextGen investors requires a data-driven approach. Factors like gender pay gaps, maternity leave policies, and diversity at the board and executive levels are no longer just social issues, hey are essential metrics for shaping investment strategies.
At Denominator, we deliver social and people data with an unprecedented level of granularity, enabling wealth and asset managers to develop tailored investment products and refine existing strategies. By leveraging this data, financial institutions can meet the growing demand for purpose-driven portfolios and create solutions that align with diverse consumer needs.
“Granular data ensure we can build more pure gender investment products and strategies. Granular data also allow clients more options to choose from – in some ways this is about democratization of investments or freedom to invest according to your own personal beliefs. Streaming platforms have enables users to select what they want to watch – when they want to watch it. Denominator is fueling the same change within Wealth Management via our granular data”
Denominator’s CEO, Anders A. L. Rodenberg
The opportunity and challenge of the great wealth transfer
This historic "Great Wealth Transfer" presents a tremendous opportunity for the industry but also poses significant challenges, especially for traditional firms grappling with evolving client expectations. Success will require a deep understanding of the distinct financial needs, preferences, and behaviors of NextGen and female clients. By tailoring offerings and adopting a structured approach, firms can better engage and serve these key client segments.
This isn’t just about wealth, it’s about people. And as we say; people are the common denominator.
Let’s shape the future of investing together.
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