The Rise of Women-Owned Wealth 

Women are earning and growing their wealth more rapidly than ever and continue their meteoric rise as leaders at the top of the family office industry. As we celebrate Women’s History Month in March 2022, Family Office Networks and FON Magazine are dedicated to promoting heightened awareness of the integral role of women in family offices, as well as more broadly throughout the nation and the world.

A look at the statistics supports the rising trend in women-owned wealth across the board over the last five decades. Not only are women earning more, but they are also investing it wisely, spreading it across a diverse portfolio of investments and philanthropic causes.

“Women are more likely to have investment roles in family offices than at asset management firms, according to a Morningstar report, said Family Office Networks Founder and CEO Andrew Schneider. “20 percent of senior investment roles are held by women at family offices and that number continues to grow exponentially.”

How did this shift in wealth come about? Consider the fact that at one time women didn’t even have any voting rights. It’s clear that the expanding influence of women in the world of wealth and family offices represents spectacular growth. Today they hold one-third of the world’s wealth, and the numbers are ever rising. Every year the number jumps by $5 trillion and contributes to the wealth market. Plus, the rate is growing year by year.

One of the main reasons behind women holding a significant share of the world’s wealth today is, of course, their position as leading entrepreneurs, savvy businesswomen, and smart investors. It’s interesting to note that 44% of wealthy women grew their wealth through entrepreneurial endeavors.

Throughout history, there has been no shortage of accomplished female role models. Examples include:
Temperance Grant – She started by opening a small venture in Newport to help sailors and their families. She allowed them the credit facility and hence created a sound business in the eighteenth century.  The sailors found the small experience quite promising, too, as it gave them just the facility they needed. As per the norm, all sailors received their payments after completing a voyage.  However, the credit facility allowed them to manage their finances better. Ms. Grant was one of the first to find this flank and filled it in instantly.

Sarah Breedlove – As another notable name in history, Sarah is the first woman millionaire who didn’t climb the family inheritance ladder and instead made her own fate. She began as an entrepreneur and started by making hair care products and selling them to black women.

Katherine Graham – She is renowned as the CEO of the Washington Post, which began as a family-owned business and later grew to become a whole media conglomerate.

Victoria Woodhull – In the nineteenth century, Victoria Woodhull became the first woman stockbroker. She and her sibling set up the foundation and built a career on faith. Following in their parent’s footsteps, both sisters were known to have supernatural powers and the ability to talk with the dead.  That led them to one fatal meetup with Cornelius Vanderbilt, who utilized their services following the death of his wife. He was a railroad magnate and amazed by the sisters’ intellect; he helped them open the first woman-owned brokerage in the United States. 

Thus began an era where women didn’t have to depend on men and their decisions on where and how to invest money. They made huge profits too, which they could keep for themselves thanks to this newfound independence. However, still, the struggle was on. Just imagine, Woodhull was also the first woman candidate in the running for President of the United States. While Woodhull, Claflin & Co. made it to Wall Street, the beliefs at that time didn’t let them make it to the New York Stock Exchange. 

By this point, you may be thinking, what do these women do differently from men? What makes their decisions, so good is that they succeeded despite the odds.

Here are a few points regarding women’s decision-making –
• Women are more likely to listen to professional financial advice.
• Women are low risk-takers and are more focused on their family’s welfare.
• They are more likely to pay for professional advice, which makes their investment more stable and with higher returns.
• The focus of women’s investment decisions is on real-time goals. As a result, they are less likely to fall for unrealistic claims and hence have no false expectations of doubling up their wealth overnight.
• The impact of a divorce or the death of a spouse is often more significant for women, especially in financial terms.

Hence, they are likely to take careful steps and seek help and guidance for their investment decisions.
Importantly, women typically trust their financial advisor, seek to mitigate risks and work to keep their investments safe while yielding the highest return.

Today’s women are more committed than ever and poised to lead the future through their smart decision-making capabilities, entrepreneurial talents, and commitment to hard work.