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The Great Wealth Transfer: A Monumental Occurrence for Women

We have become a nation of millionaires. For the 10th straight year, there are more people of means in the United States than the total populations of Greece or Portugal, according to the New York Post.

In Spectrem Group’s 2019 Market Insights Report, wealthy U.S. households with a net worth between $1 million and $5 million, not including primary residence, reached a new high for the 10th consecutive year at 10.23 million.

If you were wondering why there are more millionaires in the United States today than any time in our nation’s history, Phoenix Marketing International Managing Director David M. Thompson says, “The growth in capital markets clearly lifted more households into the millionaire ranks.”

Do the Numbers Really Tell the Tale?

Boston College’s Center on Wealth and Philanthropy says women will likely inherit 70 percent of the Great Wealth Transfer, $68 trillion, roughly two-thirds of the nation’s wealth, by 2030. Clearly, it is the most massive generational transfer ever, and it also includes leaving boomer widows businesses, portfolios, and real estate.

Annamaria Vitelli, managing director at PNC Wealth Management, told Kelly Ann Smith at, “The Great Wealth Transfer is going to be a monumental occurrence for women who will now become the decision-makers. And it’s really going to change things.”

For some of today’s wealthy married women who shied away from all-things-financial, they will likely be in the 70 percent devastated by divorce, the death of their spouse, and what comes next. The time is now for women to become educated about investing, charitable giving, and tax and estate planning.

Communication and planning needed with sudden wealth

Sudden wealth is a dramatic, singular, once-in-a-lifetime event. It is typical of lottery winners, young professional athletes, and heiresses to vast fortunes. When investment advice is needed, and unexpected taxes threaten to throw an affluent household into total chaos, a robo-advisor doesn’t cut it.

Generally speaking, for most high-net-worth investors, planning is about their entire life, not just their portfolio. “No matter who you are, or what you hope to do with the money, planning for an inheritance with the help of a professional is the key to making it last,” added Vitelli.

A 2017 RBC Wealth Management report concluded that only 22% of women have a comprehensive wealth transfer in place. “It’s critical that women seek professional guidance regarding wealth management,” said Vice President of Wealth Strategies Malia Haskins, at RBC Wealth Management.

Often times, newly wealthy individuals don’t know what to do when they receive a fortune. Wealth managers might tell their client to take a “percentage view” of their income vs. spending. If they have $5 million, think in terms of whatever percentage works – 4%, 5%, or 6% ($300K) to live on, and invest the rest.

Basically, a team of wealth managers is needed, as well as attorneys, a CPA and reliable connections through a local bank for everyday activity, transactions, and confidence, always keeping in mind that FDIC only insures deposits up to $250,000.

Partnering, not Pushing

You know women like yourself who not only want to have more money but also want to better understand and resolve their money issues through education and educational classes. Instinctively, most women will postpone making investment decisions because they want (and need) to have a lot of information to sift through first before they commit. And to their credit, women are more cautious and more risk-averse than men. They fear risk and loss and aren’t embarrassed to admit it.

Most women prefer ongoing relationships and are exceptionally loyal to a brand they like. Likewise, they are exceptionally faithful to a financial advisor whom they want and trust, that is, one who ‘gets it,’ who takes the time to reduce the stress and anxiety and offers support and reassurance. When they get more attention and contact from their advisor, they feel a secure and closer connection. Who knew?

We knew. Hefren-Tillotson advisors take the time to listen first, understand the needs of women investors, second, and educate, third. It’s how we do things.

As a company that is still family owned, we understand the importance of family goals and ambitions in managing your portfolio. We will continue to help you choose strategies that support your most personal objectives, for the security of your family for generations to come.

If you would like more information about how to successfully navigate your sudden or added wealth from the Great Wealth Transfer or anywhere else, we can help.

DISCLAIMER: Past performance does not predict future results. This report is based on data obtained from sources we believe to be reliable. Hefren-Tillotson does not, nor any other party, guarantee the accuracy or completeness of this report or make any warranties regarding results obtained from its usage. All opinions and estimates included in this report constitute the firms judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation to buy or sell the securities herein mentioned.

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