Equipping women to live on their terms with fair estate planning

More women than ever now hold significant wealth or professional influence, or both. By 2030, women in America alone will control much of the $30 trillion in assets¹ currently possessed by the baby boomer generation there. And over the course of four years, between 2015 and 2019, the number of companies with three or more women in their C-suite rose from 29 percent to 44 percent². Additionally, the number of women-led family businesses increased by 58 percent between 2007 and 2020.

This sea-change isn’t just affecting younger women. There has been a 30 percent increase in married women making key financial decisions³ on behalf of their households over the last five years. Women are also seeking guidance that aligns with their attitude and outlook, with 70 percent of women switching financial advisors within just one year of their partners’ deaths⁴. Many believe that the next generations of women will have even greater access to professional and financial opportunities than women have now.

Despite the fact that women are already in control of much of the world’s wealth, they can still feel uncomfortable or underrepresented in financial conversations. It is not surprising, given that women represent just 15% of wealth advisory professionals. In order to ensure the great intergenerational wealth transfer is distributed to female descendants too, it’s vital that they have a seat at the table during estate planning conversations.

An imbalance in female successors

Family businesses represent between 70 and 90 percent of the global GDP5 and account for up to 80 percent of jobs in some countries – which is why their attitude to female successors matters greatly. Even though women have never been better equipped to live self-determined lives, their families do not always make it simple.

In spite of the great strides women have made professionally, sons are more likely than daughters to continue the family business for a number of reasons. A third of family firms6 surveyed by Cynergy Bank agreed with the statement “it is only natural that family businesses pass onto male relatives”, with just 26 percent strongly disagreeing. Even 26 percent7 of female business owners said it was “natural” for businesses to be passed on to male relatives.

45 percent of family businesses say the introduction of gender gap reporting has made them reconsider their automatic assumptions about gender and leadership. Even so, there are other factors that can stop women moving into senior leadership roles. The University of Bristol’s 2019 Understanding Society study8 uncovered the impact of starting a family on women and men’s career prospects.

“Women and men experience a large divergence in their career paths following the birth of a baby, with only 27.8 per cent of women being in full-time work or self-employed three years after childbirth, compared to 90 per cent of new fathers.”

Empowering women to take any path

The conversation about female equality in the professional world is far from over. But as well as evaluating preconceived notions about women and family businesses, there is much work to be done in the area of estate equalisation. If a male child is left a sole or significant multi-million-euro stake in the family business, how can their siblings (female or not) be equally equipped for success?

While many women thrive in a corporate environment or love their role as an entrepreneur or business owner, others find happiness in the traditional homemaker role. A Gallup poll found that, if they were financially free to choose, 50% of women with children under the age of 18 would like to stay at home9. Estate equalisation gives female descendants who would like to concentrate solely on raising their family the financial security to do so.

Empowering women to take any path

The conversation about female equality in the professional world is far from over. But as well as evaluating preconceived notions about women and family businesses, there is much work to be done in the area of estate equalisation. If a male child is left a sole or significant multi-million-euro stake in the family business, how can their siblings (female or not) be equally equipped for success?

While many women thrive in a corporate environment or love their role as an entrepreneur or business owner, others find happiness in the traditional homemaker role. A Gallup poll found that, if they were financially free to choose, 50% of women with children under the age of 18 would like to stay at home9. Estate equalisation gives female descendants who would like to concentrate solely on raising their family the financial security to do so.

Giving women an equitable inheritance

While some traditional family businesses see their sons as their natural successors, that does not mean they want to leave their daughters with nothing. It is not easy to create an equal estate, however, particularly if the family business or a sole property represent the sum of your assets. Liquidity planning has the power to create a financially efficient inheritance that gives everyone a fair share of the family’s fortune.

Whether your female successors are running the business, starting their own professional empires or pouring their time and resources into family life, Swiss Life Generations can ensure they are equally compensated. Whatever they choose to pursue, you’ll know they have the resources to succeed and thrive.

Sources:

[1, 3, 4] www.mckinsey.com
[2] www.investopedia.com
[5] www.forbes.com
[6, 7] www.business-money.com
[8] www.understandingsociety.ac.uk
[9] https://news.gallup.com