Planner's new book schools industry on 'Women and Wealth'

A new "playbook" explaining how the wealth management industry must adapt to hire and serve more women is arriving, just as new research reiterated the business imperative for doing so.

If the moral case for boosting gender representation and eliminating persistent wage gaps among financial advisors and industry executives was not reason enough to drive change, the estimates that Baby Boomer or older widows will inherit $40 trillion from spouses and younger women will receive $47 trillion from their families by 2048 could add to the urgency. Against that backdrop, financial planner Cary Carbonaro, a managing wealth advisor and the women and wealth ambassador for Ashton Thomas Private Wealth, will publish her book, "Women and Wealth: A Playbook to Empower Clients and Unlock Their Fortune," through Wiley in April.

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"Nobody's actually addressing this, other than maybe female-led firms or female-owned firms or [Sallie Krawcheck's company] Ellevest. All of the large RIAs, this is not their No. 1 focus," Carbonaro said in an interview. "Which is why I wrote this book. It's a really big issue that we have to be ready for, and, as an industry, overall, we are not."

READ MORE: What the 'horizontal wealth transfer' means for RIAs

In releasing its latest calculations last month on the industry implications of the looming transfer of wealth to women, research and consulting firm Cerulli Associates similarly warned of the need for "substantial action toward addressing the service gap between men and women." 

That means accelerating the ongoing shift toward comprehensive financial planning, bulking up advisory practices in areas such as philanthropy (the expected destination for $18 trillion by 2048) or divorce-related resources and, at a minimum, including both spouses and any children in the process (which is associated with an 80% retention rate after death or another client transition), according to Chayce Horton, a senior analyst in Cerulli's wealth management unit and a co-author of the report. In addition, more professional development aimed at women such as leadership councils and networking conferences could address the "huge problem for the industry" related to the fact that five out of six advisors are men, Horton said in an interview.

"It's going to be really important to improve hiring, improve training, improve networking, improve mentorship and improve retention of women across the industry," he said. "We find that not only helps boost their confidence and the sharing of skills, but it also boosts the ability for that firm to retain talent. … Firms that can support women advisors are in a great opportunity moving forward as this wealth moves to women."

Unfortunately, the continuing research on the trillions flowing to women has come alongside the ongoing stream of data highlighting their underrepresentation in wealth management and across the financial services in general. Carbonaro strived for her book to act as "a long-term resource" for those committed to altering those dynamics, rather than as something to "read once and set aside," she wrote in a message to readers at the beginning.

"My hope is that this book will not only help you grow financially but also encourage you to become an advocate for women's wealth, empowering others to do the same," Carbonaro wrote. "Together, we can reshape the financial industry and ensure that women are not just participants but leaders in creating their financial future."

To that end, firms could follow her example in creating roles such as her title of "women and wealth ambassador," recognize the "the rise of female breadwinners and female entrepreneurs" as a base of clients, and develop training and coaching that teaches investors and professionals of any gender to avoid acting out of unconscious bias, Carbonaro said.

READ MORE: Same work, huge gender pay gap at banks and credit unions

The book covers many topics in 23 chapters examining what the industry is doing wrong, the history of women and money, the reasons that many female clients leave their advisors, the prevalent "bro culture and lawsuits" at financial firms and any number of case studies and research reports cited throughout the text. 

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In addition, the veteran planner tells her personal story about her upbringing as the child of a banker and a tax professional, the money problems she had to navigate in a divorce and her experience moving to Goldman Sachs and leaving the firm. She challenges the industry to take the steps she outlines in order to attract more women as clients and advance their careers in the profession, like educational programs, seeking opportunities in client transitions, addressing race and gender-based disparities and altering the entire approach to the business.

"Financial firms must develop a deeper understanding of women's financial needs and preferences, focusing on life goals and risk tolerance. This includes recognizing the significant role women play in decision-making and creating services that respect their financial savvy," Carbonaro writes. "Firms need to adapt their business models to better cater to women, incorporating empathy, education and empowerment into client relationships. This involves rethinking service delivery, pricing and compensation models."

While making wealth management firms more friendly to women has always been "a huge goal of mine," at times, that struggle feels like "pushing a boulder up a hill, and it keeps falling back on me," she said.

"First, they have to understand what the million-dollar opportunity is. It's about dollars and cents," Carbonaro said. "Womens' psyche and brain and how they view money is different from men."