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Women and Wealth Series Part I: Women and the great wealth transfer

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March celebrates Women’s History Month. As women on average live longer than men, most wealth is, or will soon be, in the hands of women. Throughout the month of March Ascent’s Family Historian, Karen McNeill, will take a look at how women and wealth have the potential to transform the economy.

             Possibly it is not far-fetched to suggest that women, because they own and control so large a part of the country’s wealth and income, could, if they chose, so change the manner of using that wealth and income as to contribute toward the building of a better social and economic order.”

Margaret Elliott, Women and Wealth
           


Obviously, Margaret Elliott was referencing “the great wealth transfer,” or the estimated $30 trillion that will be passed from Baby Boomers to younger generations over the next 30 years. According to several studies, 70 percent of the $30 trillion will be inherited by women. Beyond inheritances, women are growing their wealth at a faster pace than men; they are better educated, work in higher numbers, more likely to launch businesses, and becoming millionaires at a higher rate than men. They also control about 80 percent of consumer spending. In short, as Elliott suggests, women are a powerhouse that cannot be ignored.*

Understandably, financial organizations have invested a lot of time and effort into understanding women’s relationship to money and wealth management. They have focused particularly on women’s behavior around education, planning, investments, and philanthropy. The results are pretty consistent: women are confident about everyday decisions and more likely to delegate decisions about long-term planning to men. Family is paramount in their decision-making world, and they care about the impact of their wealth on society as well as the alignment between financial decisions and values. Women tend to be far more charitable than men, and are more likely than men to give collectively, such as participating in charitable circles.

 
While the scale and pace of women’s wealth ownership may be growing at unprecedented rates, the culture around wealth and money decisions is deeply embedded in history.

    

Here’s the thing, Margaret Elliott published those words in 1934. She did so in response to statistics indicating an impressive showing of women’s growing access to wealth: by the 1930s women controlled 80 percent of consumer spending, claimed well over two thirds of financial inheritances, and 80 percent of life insurance payments. While women had access to fewer types of jobs and only earned 33 cents for every dollar earned by men, Elliott’s study estimated that 77,000 single women, or about one percent of women in the workforce, earned an average of $19,000 (equivalent to about $279,000 in 2019). So, you might say the great wealth transfer began ninety years ago.

While the scale and pace of women’s wealth ownership may be growing at unprecedented rates, the culture around wealth and money decisions is deeply embedded in history. By the time Margaret Elliott published her study, women had spent nearly a century developing the nonprofit sector through their charitable work. They often worked collectively and pooled resources to maximize the impact of their wealth, and that impact was paramount to society. These aspects of women’s culture around money have carried into the twenty-first century.

Next: Part II: Women and Philanthropy


*Source: Shurwest.com, “Financial Facts for Women’s History Month,” March 14, 2017.

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NOT A DEPOSIT • NOT FDIC INSURED • MAY LOSE VALUE • NOT BANK GUARANTEED • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY

U.S. Bank and its representatives do not provide tax or legal advice. Each individual’s tax and financial situation is unique. You should consult your tax and/or legal advisor for advice and information concerning your particular situation.

Wealth Sustainability services are not fiduciary in nature and Ascent serves in a non-fiduciary role when providing these services. Wealth Sustainability services may include strategic wealth coaching services in order to facilitate your self-assessment of wealth sustainability issues. Ascent does not engage in the practice of psychology.

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Investment products and services are:
Not a Deposit   •   Not FDIC Insured   •   May Lose Value   •   Not Bank Guaranteed   •   Not Insured by any Federal Government Agency

 
 

Equal Housing Lender Equal Housing Lender. Credit products are offered by U.S. Bank National Association and subject to normal credit approval. Deposit products offered by U.S. Bank National Association. Member FDIC.

U.S. Bank and its representatives do not provide tax or legal advice. Your tax and financial situation is unique. You should consult your tax and/or legal advisor for advice and information concerning your particular situation.

Wealth Sustainability services are not fiduciary in nature, and Ascent serves in a non-fiduciary role when providing these services. Wealth Sustainability services may include strategic wealth coaching services in order to facilitate your self-assessment of wealth sustainability issues. Ascent does not engage in the practice of psychology.