Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: You're listening to Bloomberg BusinessWeek with Carol Masser and Tim
Speaker 2: Stenovek on Bloomberg Radio.
Speaker 1: So women are controlling ever greater sums of money around
Speaker 1: the world, setting the stage for major shifts in wealth
Speaker 1: management and philanthropy. In the US alone, McKinsey expects women
Speaker 1: to control thirty four trillion dollars are roughly thirty eight
Speaker 1: percent of investable assets by twenty thirty. That's close to
Speaker 1: double last year's total. The figure was just seven point
Speaker 1: three trillion. That was twenty nine percent. That was about
Speaker 1: ten years ago.
Speaker 2: Tim, the world of finance, wealth management, and banking are
Speaker 2: all recalibrating for this great wealth transfer. With more in
Speaker 2: our new weekly discussion on Women, Money and Power, where
Speaker 2: we explore the economic implications of these changes and how
Speaker 2: to navigate them. We welcome April Rudin, founder and CEO
Speaker 2: of The Rooting Group, and Nick Rice, director at Brunswick,
Speaker 2: are the co authors of the forthcoming Wealth Management With
Speaker 2: the Difference, Your Guide to achieving client, generational and business success.
Speaker 2: It comes out late next month. They both join us
Speaker 2: here in the studio. Welcome to both of you. We've
Speaker 2: been talking about this great wealth transfer for quite a
Speaker 2: bit of time. I mean purely demographics when we think
Speaker 2: about aging baby boomers and then who ends up receiving
Speaker 2: those funds. I want to start with you, April, the
Speaker 2: economic implications of these changes and what it means for
Speaker 2: new trends when it comes to investing, saving, and of
Speaker 2: course giving.
Speaker 3: Well, it's huge. It's as you said, it's the intersection
Speaker 3: of all of these different factors coming together. There's never
Speaker 3: been a better time to be in wealth management. I
Speaker 3: would say the opportunities for financial advisors and for all
Speaker 3: firms that are serving in financial services. That sector of
Speaker 3: women is gigantic because you have financial advisors that are retiring,
Speaker 3: you have women inheriting more money. It's actually more of
Speaker 3: a wealth transition going to talk about rather than a
Speaker 3: wealth transfer. Is actually vertical. Right, Women live longer, and
Speaker 3: so before that wealth transfer has happened, there's going to
Speaker 3: be a wahy Is.
Speaker 1: That an important distinction?
Speaker 3: So I started my firm seventeen years ago talking about
Speaker 3: the wealth transfer, it actually hasn't really happened. You still
Speaker 3: from those McKenzie stats, you have people still talking about
Speaker 3: it's going to happen. It's happening, is it happening? And now?
Speaker 3: And people were under the impression that the transfer was
Speaker 3: also going to go to gen Z, right, But actually
Speaker 3: it's going to go to gen X, and gen X
Speaker 3: are now in their sixties and approaching retirement themselves, some
Speaker 3: of them. So I think it's more complicated than what
Speaker 3: people think, and so it's important to pull it apart
Speaker 3: and understand more about what's happening.
Speaker 1: Nick, I want to bring you in, So how much
Speaker 1: do things change when it comes to the investing world
Speaker 1: and the approaches, Like how much is going to be different?
Speaker 1: Because I you know, it's interesting that you know, we
Speaker 1: sometimes men for swimmen and the distinctions, but is it
Speaker 1: all that different?
Speaker 4: Yes, so that it's going to be significant change. I
Speaker 4: think all the data shows that women are very, very
Speaker 4: passionate about using their investments and their philanthropy to fulfill
Speaker 4: specific purposes and to ensure that they have impact in
Speaker 4: a way that might not have happened in the past,
Speaker 4: or they might not have had the tools to do that.
Speaker 4: Always in the past, there's been a strong trend towards
Speaker 4: philanthropy among older generations, but female clients, particularly a younger
Speaker 4: generation are more focused on measuring that impact, generating that impact,
Speaker 4: and also making money through purpose driven activities.
Speaker 2: So where on the impact side of things, where does
Speaker 2: that end up going? So it varies, right.
Speaker 4: So you can look at it through a sustainability framework.
Speaker 4: A lot of clients prefer to look at a sustainability framework,
Speaker 4: targeting things like the environment or social causes that.
Speaker 1: We stopped caring about that.
Speaker 4: Well, some clients don't choose to look at it through sustainability.
Speaker 4: It varies depending on the client, but a lot of
Speaker 4: clients target the same underlying causes whether or not they
Speaker 4: use the sustainability framework. You can target healthcare as a
Speaker 4: client through your investments, through your philanthropy. You can use
Speaker 4: the sustainability framework to do that, or you cannot use
Speaker 4: the sustainability There are various different ways of cutting the
Speaker 4: pot I want to bring.
Speaker 1: You in on the same thing, like, you know, why
Speaker 1: is it so different? But we hear from Nick that yes,
Speaker 1: it will be different.
Speaker 3: Also to your point, I think sometimes US is very
Speaker 3: US centric, and whereas that might be true in the US,
Speaker 3: our book is for a global audience and that has
Speaker 3: not died down in Europe and Asia. Impact investing and
Speaker 3: sustainability is really hot and is something very important.
Speaker 1: I love that you went there. We're just coming off
Speaker 1: the U in General Assembly and we did a big
Speaker 1: broadcast last Wednesday from the Plaza. Bloomberg does a big event,
Speaker 1: a global forum, and I felt like most of who
Speaker 1: we talked to, a lot of European officials and yes,
Speaker 1: talking about alternative energy, renewables, how it financially makes sense,
Speaker 1: that nothing's changing, and that really struck me in those discussions.
Speaker 2: Well it struck us because here in the US we
Speaker 2: are the changing administration has really changed the tone when
Speaker 2: it comes to renewables and also when it comes to
Speaker 2: foreign aid, and pretty much every guest we spoke to
Speaker 2: Carol at that event was talking about how to maximize
Speaker 2: the impact of foreign ad and how to maximize the
Speaker 2: return from renewables.
Speaker 1: Yeah, I think it's kind of fascinating.
Speaker 3: So that's one of the reasons why we went global
Speaker 3: on this book, and we spoke to eighty senior leaders
Speaker 3: across the world, because more and more firms are global
Speaker 3: in nature, and more and more people are mobile in nature,
Speaker 3: and so having a better understanding of what our world
Speaker 3: is and technology connecting us is truly important. Even visiting
Speaker 3: some of the headquarters of some of the firms and
Speaker 3: you can see a huge difference where some firms are
Speaker 3: very traditional in the way that they look. Other firms
Speaker 3: have a more sustainable approach. As Nick was saying, you
Speaker 3: see firms that have more green, more exposed brick. You know,
Speaker 3: they in London, They've purchased a building and have redone.
Speaker 3: It's something we don't really see here in the US,
Speaker 3: where we're just going to, you know, knock the building
Speaker 3: down and build something back up again. But there's an
Speaker 3: effort to create sustainability and demonstrate it through their brand.
Speaker 1: What does this mean in terms of money flows? So
Speaker 1: we are Bloomberg and that is something whether it's a
Speaker 1: fun advisor or whatever. You know, Tim and I constantly
Speaker 1: talk about, so where the money goes? So where does
Speaker 1: the money go? Potentially as we see this money, this
Speaker 1: wealth transition, where does it go? Is it green or
Speaker 1: sustainable efforts? Is it more global efforts? Like how do
Speaker 1: you see it playing out?
Speaker 4: I think alternatives are a big piece of this. We're
Speaker 4: seeing increasing capital flow towards alternative investments, specifically right credit
Speaker 4: and things like predvate markets, but also digital assets, right,
Speaker 4: And we've seen the rise in vehicles that will enable that, right,
Speaker 4: be those through new types of vehicles that wealth management
Speaker 4: clients can more easy access, or also increasingly through retirement plans.
Speaker 2: Right.
Speaker 4: We saw the executive orders the other week. That's an
Speaker 4: important part of it. Also, international is a very important
Speaker 4: part of it. I think people thought with the globalization
Speaker 4: that it would just make people more domestic. In reality,
Speaker 4: it makes your international footprint more complicated, and we're seeing
Speaker 4: a lot of wealth managers retool in order to account
Speaker 4: for that greater international footprint.
Speaker 1: Hey, I want to.
Speaker 2: Finish where we started with you, and you said that
Speaker 2: there's been no greater time to be in wealth management.
Speaker 2: If you would have told me ten fifteen years ago
Speaker 2: that that would be the case for twenty twenty five,
Speaker 2: I wouldn't have believed you. Because we saw the rise
Speaker 2: of robo advisors, passive investing, the idea of setting it
Speaker 2: and forgetting it, which I thought millennials would be doing,
Speaker 2: make the argument and make the case that people are
Speaker 2: paying that higher fee to get that personalized advice.
Speaker 3: So it's really the confluence of all these different things happening.
Speaker 3: It's more and more advisors retiring, it's volatile markets. As
Speaker 3: the mother of two gen Z kids, I'll tell you
Speaker 3: that they're more conservative than what people think, and I
Speaker 3: think they want to have bigger brands that they rely on,
Speaker 3: so I think there's an opportunity there. I think that
Speaker 3: there is a general need for more financial literacy and
Speaker 3: amen around that, because even for financial advisors. I was
Speaker 3: just going to add one more thing which Nick and
Speaker 3: I always talk about. There's been a real shift in
Speaker 3: who is a financial advisor and how to recruit people
Speaker 3: into it. Only fifteen percent of the workforce is women,
Speaker 3: and traditionally finance majors have been recruited and now not
Speaker 3: so much.
Speaker 1: We have to leave it there. I hope we can
Speaker 1: continue in the future. April Ruden of course of the
Speaker 1: Rudent Group, Nick Rice of Brunswick and check out their
Speaker 1: book Wealth Management with a Difference. And also we have
Speaker 1: a special event in London women Money and Power. Be
Speaker 1: sure to check it out.