Women will become custodians of more than 65% of the $4.9 trillion intergenerational wealth transfer over the coming years, JBWere estimates. The number of female millionaires grew at a rate of 5.7% in 2023, almost double that of male millionaires.
Women became millionaires at twice the rate of men over the past decade, according to research from NAB, JBWere, and CoreData. The shift in the socio-economic status of women in Australia will continue to accelerate in the years to come, as we approach the largest intergenerational transfer of wealth in Australian history.
“The cohort of high net worth (HNW) women in Australia is growing at a faster pace than men, with increased workforce participation and surging female entrepreneurship,” says Maria Lykouras, the CEO of JBWere Australia.
Lykouras classifies the funds coming to women in the coming years as a ‘tsunami,’ and notes that women may prioritise different things when choosing a financial advisor to support them in investing their wealth.
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The JBWere research reveals that women are looking for four factors when appointing a financial adviser: A range of investment options; transparency; the adviser’s track record; and communications skills.
“The research tells us that it’s a dealbreaker for women if their financial adviser doesn’t capture the full financial picture and tailor investment solutions appropriately,” says Lykouras.
In addition to increasing rates of female entrepreneurship and workforce participation, the number of HNW women in Australia is being accelerated because of intergenerational wealth transfer, the death of a spouse, and divorce.
The sectors that HNW women are predominantly invested in are real estate (63%), shares (59%), and cash (51%).
“Advisers play a crucial role in empowering already confident women to take the next step with their investments. Women often rely on their adviser as a critical source for information and to provide options that match with their risk appetite and future financial direction,” says Lykouras.
The shift in demographics provides further opportunity for women to become financial advisers, and support HNW to invest. Currently, just 55% of female baby boomers have a financial adviser, whereas 67% of Gen Y females have advisers, according to the JBWere whitepaper. The ‘advice gap’ is an opportunity for banks to increase female participation in the wealth sector.
“With women across Australia set to take charge of the intergenerational wealth transfer, the demand for high-level support from advisers will be critical to shaping the financial future for thousands of Australian women and their families. There is a clear need for the financial services industry to support more women becoming advisers,” Lykouras said.
Other factors accelerating growth of HNW women
The JBWere whitepaper discloses that women studying STEM fields is also contributing to the number of female millionaires.
“More women are entering STEM-related higher education courses,” the report reads. “This is leading to growing rates of women in tech-based careers, across areas critical to modern economies. These areas, which include Information Media and Telecommunications, and Professional, Scientific, and Technical Services, offer women greater earning potential.”
“There is a clear need for the financial services industry to support more women becoming advisers.”
Maria Lykouras, CEO JBWere Australia
Increasing opportunities for women to move into leadership roles also increases their ability to earn more. Beyond the C-suite, the number of women pursuing entrepreneurship is also on the rise.
“The number of female entrepreneurs is growing three times faster than their male counterparts, and women now own one third of Australia’s small businesses. This highlights the impact of women on key financial decisions across the business landscape and across
personal wealth management,” the JBWere whitepaper states.
NAB Private Wealth returns as presenting sponsor of the Forbes Australia Women’s Summit on Tuesday, 26 March. Final remaining tickets here.
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