The Opportunities and Challenges of Being a Woman in the Retirement Industry
Recently I sat down with Allison Brecher from Vestwell to discuss the unique opportunities and challenges of being a woman in retirement (you can read the article here). It was a great discussion, but since there was so much more I wanted to say in the limited time we had, I thought I'd write a blog article and share those thoughts. Interested? Read on!
What attracted you to work in the retirement plan sector?
Coming out of college, I knew nothing about how money or retirement plans worked and I had only a basic understanding of investing. In truth, I fell into retirement plans as a career! For my first job, which I got blindly through the career center at college, I had to learn all about the state pension so that I could explain it in terms of how the 403b plan acted as a supplement and how it was different. I loved being able to educate people on a complicated topic, help them plan to have the future life they wanted, and make the concepts of investing easy. It was a tough year to be doing it -- 2001, right after the tech bubble -- but also an amazing opportunity to explain asset allocation, diversification, and buying low and selling high. The educational piece had me hooked, along with helping people be purposeful about how long they wanted to work and what they wanted to do when financially independent.
What other women inspire you in your line of work?
There are so many great trailblazers that inspire me. I was a trumpet player in college and I was definitely inspired by Barbara Butler, an incredibly accomplished trumpet performer and teacher. (Brass instruments and orchestral players, in general, were male-dominated until the 1970s when blind auditions were introduced.) She taught me that the performance product was everything and started me off on the relentless pursuit of excellence. No one can argue with you getting the job if you're hands-down better than everyone else. And she and her husband, Charlie Geyer, were, and I'm sure still are, masters at DEI. Work product is what mattered in their studio. Period. There was no place for anyone who thought looks factored into ability or that feedback should be withheld.
Very early, maybe three years into my career, I sat next to Dorann Cafaro of Cafaro-Greenleaf and thought, Oh hey, there are some women in retirement plans after all! So thanks to her for showing me it was possible. At that time, there were only 2 other women brokers in the firm where I was working. Every other woman in the office was an assistant. One of the brokers had been told she couldn't get the series 7 (because women didn't do that) among a myriad of other challenges, and here she was years and years later as one of the most successful and highest producers in the office.
I came across Anne Lester when she was at JP Morgan at a NAPA Connect conference. In hearing her talk about her career and identifying that her perspective was often different than her peers, I realized that there are many paths that will take you to the same place, it wasn't necessary to do things the way others have, and that there's so much value in thought leadership that comes from a place of diverse or nontraditional thinking.
Why do you believe women are underrepresented in the financial industry and how can we change that?
First we have to take a step back and agree that they are underrepresented. To catch up on the conversation and see the data, check out McKinsey’s research here.
Financial services has always been presented as a boys club, and implicit bias is hard to overcome. Check out all the Wall Street movies. Where are the women? Why would you want a job in an industry that has been represented as one where they don’t do right by their clients, it’s all strippers and coke parties, and a bunch of dudes trying to make as much money as possible? There’s no one to thank except Hollywood for that stereotype. But seriously, when’s the last time you saw women being recruited into Wall Street jobs by their fraternity brothers? There are a lot of problems here that have gotten us to where we are now. No matter -- let’s just fix it.
Here are four ways to help change the landscape and the outlook for women in financial services. Note that these suggestions are not unique to financial services. Any company would benefit from implementing them.
Cross-company Relationships. The more women that other women see in leadership positions, the better, because it shows what's possible, and that everyone is part of the club. But, you need a pipeline of qualified candidates to put in leadership roles, women included. Challenge your employees with the question, "Who have you helped that doesn't look like you or isn't like you?" That encourages mentorship across a wide variety of candidates and employees. Creating an atmosphere or opportunities where unlikely friendships and connections can happen across business units is just as useful and easier to measure.
Increase your own personal networks. When it comes time to job hunting and hiring, the majority of folks get a job through someone they know. The easiest way for employers to get more candidates that are diverse is to have a more diverse network that you're talking to about those openings. Your social media is an echo chamber -- it's built for confirmation bias. Make new work "friends" and you'll get the opportunity for more women and minority candidates to enter the financial services industry.
Improve Feedback. There is evidence that women receive significantly different and less useful feedback than men do in performance reviews and it’s holding them back. Anecdotally, in college, one of my instructors told me he couldn't give honest feedback to another female student because he was afraid she would cry. Eight years out of school, I asked a VP what I could do to better position myself to get a job on his team. He struggled for a few minutes and then finally said to go get another credential. (I was already the most schooled of the candidates that were getting the job.) So, fix this. Teach managers and employees to give feedback. This is a skill like anything else! I might add that it starts with purposely building a corporate culture where it's safe to speak up, disagreement and discussion are valued, and everyone is expected to participate. But if you can't foster that culture, at least start with teaching feedback skills. I highly suggest reading Let's Talk: Make Effective Feedback Your Superpower, by Dr. Therese Huston.
Retool your promotion process. When evaluating candidates for promotion, use separate and joint evaluation. When you ask the question, "Who should get the promotion," it's a choice made in isolation. It implies which [singular] person, choose only one. If you evaluate only one option at a time, the emotional self tends to be heavier in the decision-making rather than the rational self. Instead, ask your team to prepare a list of candidates side-by-side, and then evaluate them one at a time against each other. The joint evaluation method has been shown to decrease discrimination against women. There’s plenty of research and tips available from Max H. Bazerman at Harvard Business School. An easily digestible entry point is Choiceology with Katy Milkman, Season 5 Episode 4, A Choice Apart: With Guests Max Bazerman & Vivienne Wagner.
The irony of this is it relates to financial services. It’s like the cobbler’s kid has no shoes… If you want women to be more financially prepared for retirement or to experience better “financial wellness” and stability, the number one way is to increase their earning potential. Saving in a 401k or 403b plan is dependent on saving a percentage of your pay, so increase that pay, increase the retirement outcome.
For more information on women in financial services, keep an eye out for research reports coming out of two places: the Women in Pension Network and Hidden Insights Group.