The Rise of Female-Controlled Wealth: A Strategic Analysis

For years, McKinsey has tracked the steady rise of female-controlled assets and analyzed its potential implications in the United States and in Europe. McKinsey recently surveyed more than 13,000 US and European investors, of whom almost half were female financial decision-makers. The team also interviewed wealth managers in the United States and Europe to better understand the challenges involved in attracting and retaining female clients. The survey and interview responses describe an industry still striving to adapt to a massive ongoing shift in its customer base.

The share of investable wealth controlled by women continues to rise, driven by four complementary social, economic, demographic, and cultural trends. Yet despite their burgeoning affluence and increasing financial confidence, women remain less likely than men to engage with wealth managers—resulting in a vast and growing pool of unmanaged assets. Women report starkly different financial goals than men, as well as unique expectations vis-à-vis their advisors. As female-controlled wealth continues to surge, wealth managers who are best able to identify clearly defined microsegments within the female investor base and cultivate teams capable of meeting their specific needs will be poised to access a multi-trillion-dollar opportunity.

The rise of affluent women and the changing face of wealth

Women currently control about one-third of all retail financial assets in the European Union and United States, and this share is expected to rise to 40 to 45 percent by 2030. The growth of female-controlled assets continues to outpace the market: Between 2018 and 2023, global financial wealth increased by 43 percent, while the amount of wealth controlled by women rose by 51 percent. As of 2023, women controlled an estimated $60 trillion in assets under management (AUM), representing about 34 percent of global AUM.

Affluent women, however, are less likely than men to work with financial advisors—a situation that creates a large and growing opportunity. An estimated 53 percent of assets controlled by women are currently unmanaged, versus just 45 percent of assets controlled by men. Bringing the share of managed assets among women to the level of their male counterparts represents an opportunity of about $10 trillion by 2030, and players that successfully tailor their value propositions, marketing strategies, and service offerings to women could surpass that benchmark. The following analysis focuses on cisgender women in heterosexual couples, but wealth managers can adapt the suggested strategies to address the needs of other underserved segments of an increasingly diverse client base.

A tectonic shift in the industry landscape

Women’s expanding control over investable assets is transforming the landscape of European and US financial markets. In Europe, assets controlled by women grew from $4.6 trillion in 2018 to $6.6 trillion in 2023, expanding from 32 percent to 38 percent of total EU AUM, consistent with our research predictions. McKinsey now projects that female-controlled assets will reach $11.4 trillion and 47 percent of all EU assets by 2030. In the United States, total assets controlled by women rose from about $10 trillion in 2018 to about $18 trillion in 2023, expanding from 31 percent to 34 percent of US AUM. Female-controlled assets are now projected to nearly double to $34 trillion, representing about 38 percent of total US assets, by 2030.

A combination of social, economic, demographic, and cultural trends is driving the rise of female-controlled wealth and triggering money-in-motion events:

• The social trend is an ongoing decline in marriage rates coupled with persistently high divorce rates. Women are more likely to marry later in life, less likely to marry at all, and more likely to divorce if they do marry, with the result that a growing share of single women have full financial autonomy.
• The economic trend is the continued growth of women’s average earnings. As women continue to outpace men in educational attainment and access an increasing share of high-paying jobs, they are more likely to accrue and possess investable assets, regardless of marital status.
• The demographic trend is the concentration of wealth among baby boomers combined with the lower average age of female spouses and women’s longer average life spans. These factors are contributing to a rapid increase in the number of affluent widows.
• Finally, the cultural trend is a broad shift in attitudes about the role of women in managing their finances, both as individuals and jointly with their spouses. This trend is especially pronounced among women themselves, with the percentage of women who express confidence in their ability to make financial decisions increasing dramatically in recent years.

As a result of these trends, women are more likely to make important household financial decisions and more likely to be independently affluent. Women control a large and growing share of wealth, and they are increasingly confident in their capacity to manage it.

Despite the ongoing rise of female-controlled wealth, the industry has yet to recognize the unique goals and preferences of female investors. Most firms continue to market propositions to women that are virtually identical to those marketed primarily to men for decades, yet the interests, objectives, and characteristics of affluent women differ substantially from those of their male counterparts. Understanding these differences is essential to devise more effective strategies for capturing the immense and growing opportunity in female-controlled wealth.

Evolving attitudes and unique characteristics

While women of all ages are experiencing a remarkable rise in financial confidence, the change is most dramatic among younger women. In Europe, the percentage of women who feel somewhat comfortable or totally comfortable making financial decisions rose from approximately 45 percent in 2018 to 67 percent in 2023. Millennial women are driving the trend, and their reported confidence increased by 32 percentage points over the period. Similarly, the share of US women under 50 who express financial confidence jumped from 48 percent in 2018 to 61 percent in 2023, while the share of US women of all ages who expect to achieve their financial goals rose from 51 percent to 54 percent over the period.

With increased confidence comes a heightened awareness of costs, and women have proven especially willing to switch advisors if their investment needs are not being met. Price awareness among female investors rose from 60 percent in 2018 to 75 percent in 2023, while men experienced a more modest increase from 75 percent to 85 percent. The narrowing gap in price awareness highlights women’s increasingly active engagement as consumers of financial services, and survey data corroborate this trend. In Europe, 30 percent of women express dissatisfaction with the quality of the financial services they receive, and 37 percent say they are likely to change banks in the coming years.

Young women are most likely to compare offerings across competitors. In the United States, 43 percent of women under 50 with an in-person advisor strongly agree that one should periodically shop around for better rates, a view shared by 32 percent of women under 50 without an in-person advisor. Moreover, 56 percent of US women between ages 25 and 34 describe themselves as likely to change banks, compared with just 19 percent of women over 65. In Europe, the top three reasons for women’s dissatisfaction with their current financial service provider relate to customer service, value for money, and independence of advice. Firms that effectively address these concerns and tailor their services to suit the broader preferences of affluent women will be best positioned to attract and retain female clients.

Women demonstrate unique financial behaviors and preferences, and these features are consistent over time:

• Women value in-person financial advice. In Europe, 76 percent of women report requiring investment advice at least once a year, compared with 71 percent of men. While the overall gap is modest, both the need for advice and the preference for in-person advice correlate closely with age. In Europe, the share of women who prefer in-person advice rises with age: 35 percent for the 18-to-35 age group, 41 percent among those aged 35 to 65, and 50 percent among those over 65. In the United States, women over 50 are more willing than younger women to pay a premium for in-person service. The desire for personalized support and advice among older women likely reflects the rising share of widows and divorcées in older age groups. Previous McKinsey research has highlighted the unique financial needs of widows and divorcées, as well as the rewards garnered by firms that successfully reach them.
• Women prefer stable investments and focus on the long game. Both in Europe and the United States, women tend to adopt a measured and cautious approach to investing that prioritizes long-term financial security. In 2023, 45 percent of European women were defined as risk averse, versus just 38 percent of men. Women also tend to focus on achieving specific goals, rather than reaping the highest returns. In 2023, US women’s top three financial goals were ensuring that they do not outlive their retirement assets, managing healthcare and long-term care costs, and maintaining their lifestyle.

Capturing the opportunity in female-controlled wealth: Insights from industry leaders

We interviewed industry leaders to reveal how wealth managers can more effectively serve the distinct needs and aspirations of female clients. Given the industry’s limited overall success in reaching affluent women, institutions that apply these insights can position themselves to outmatch the competition in a large and growing segment of the client base.

How wealth managers fail to reach affluent women

Although women control an increasing share of assets, are gaining financial confidence, and expect more from their advisors, the wealth management industry has only marginally adapted to their needs, goals, and preferences. Many institutions have launched dedicated events or campaigns targeting women, but few have implemented real changes in terms of offerings, value propositions, and relationship management. We spoke with industry leaders from Europe and the United States to understand why so many wealth managers still struggle to access the opportunity presented by female-controlled wealth. Three key challenges emerged from the interviews: insufficient diversity at the team level, a reflexive focus on male clients, and ineffective outreach to younger women.

Lack of diversity in the advisor pool. While our research indicates no preference for same-gender advisors, the industry leaders we interviewed see a link between the diversity of their advisor pool and their ability to meet the unique needs of female clients. Teams that include women and members of other underrepresented groups are seen as better able to retain female clients during major life events such as divorce or widowhood, key moments at which women are most likely to switch advisors. Despite ongoing gains in gender parity, women continue to make up only 23 percent of the advisor pool in the United States and about 18 to 20 percent in Europe. Recruiting more female advisors is an essential part of capturing the opportunity in female-controlled wealth, but diversity goes beyond gender. The goal is to cultivate inclusive teams that are better able to adapt to an evolving client base.

Persistent focus on men as the primary clients. According to the senior executives we interviewed, many advisors still reflexively consider men to be the main financial decision-makers in heterosexual couples, and they often neglect to build one-on-one relationships with their male clients’ spouses. This approach can make it difficult to retain women as clients after a divorce or the death of the husband. The executives also note that advisors may be uncertain about how best to engage female clients, especially those who appear reluctant to participate in financial discussions or who tend to defer to their partner in financial matters.

Insufficient engagement with younger women. Connecting with younger generations is a key challenge for the wealth management industry, and the executives interviewed describe younger women as especially hard to reach. Because women tend to be less confident in making financial decisions or managing risk in their portfolio, giving them access to financial education and advice early in their wealth journey is especially important. But women typically start working with financial advisors later in life: In the United States, 35 percent of women who work with an advisor did not start doing so until after age 45, while the same is true for just 28 percent of men. Firms that fail to reach younger women risk missing the opportunity to build long-term relationships with female clients that will endure as their wealth grows and their circumstances evolve.

Making outreach to female investors an element of core strategy

Between now and 2030, women are expected to assume control of an additional $16 trillion of assets in the United States and $4.7 trillion in Europe. Under a business-as-usual scenario, more than $10 trillion of that combined $20.7 trillion will remain unmanaged. Leaving this pool of funds to languish in checking accounts and low-yield savings vehicles would be an even greater missed opportunity, causing women to retire later and with less wealth.

To better connect with female investors and expand their share of the large and growing pool of female-controlled assets, firms need to educate their workforces, engage equally with men and women as account holders, initiate conversations with women early in their wealth journey, and leverage behavioral segmentation to reach key demographics within the larger population of affluent women.

Build teams that can more effectively reach women. With many independent financial advisors nearing retirement, firms have a chance to attract a new generation of female advisors and corporate leaders whose experiences and perspectives can inform their approach to affluent women. While firms should not attempt to match female advisors to female clients, teams that include more women can help firms build stronger relationships with female holders of joint accounts and enhance their ability to retain female clients after divorce, widowhood, or other major life events. Building more diverse and inclusive teams will require dedicated efforts to make careers as advisors more attractive to women.

Educate advisors on how to engage and retain female clients. In parallel, firms should equip their current workforce with the skills and knowledge necessary to understand and engage with female clients. Traditionally, advisors have tended to center their discussions with women on everyday subjects like budgeting and cash management, limiting both the scope and depth of their engagement. By contrast, initiating informative joint conversations on complex issues around investment and estate planning can prepare women to act as sole decision-makers during money-in-motion events. Firms should incorporate gender sensitivity into a holistic effort to develop needs-based, planning-led advisory teams, which will be better able to advance the interests of all clients, not only women.

Serve the needs and goals of households rather than individual clients. Historically, married women have often been regarded as the secondary holders of joint accounts, with most investment decisions left to their spouses. As women continue to gain financial confidence and independence, wealth managers must treat them as equal partners in financial decisions. Building trust-based relationships with women is vital to increase retention. One advisor we interviewed reported that out of six divorces within his client base in a single year, he successfully retained both partners as clients in every instance. He attributed this success to consistently involving both individuals in financial discussions and following up with women if they missed meetings to ensure they felt equally valued and engaged. Beyond increasing retention, adopting a household-based approach to client relationships that expressly regards couples as joint decision-makers and that leaves space to progressively engage with children can enable financial advisors to build strong multigenerational client relationships.

Develop differentiated strategies to address the evolving needs of women across their wealth journeys. Educating teams on behavioral differences between male and female investors can lay the groundwork for more precisely targeted outreach. Within the broad category of female investors, our research has identified six key archetypes based on the personal and financial characteristics that have the greatest influence on consumer behavior.

Among women in the United States and Europe, “young engaged investors” are a key archetype. To build trusting relationships with young women as they accumulate wealth, financial institutions must develop a deeper understanding of their values and preferences. This understanding can inform the design of a differentiated interaction model in which the most relevant content is presented in the most appealing manner and delivered through the most effective channels. For example, young engaged investors tend to be more cost