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00:00The great wealth transfer doesn't seem like everybody's ready for this, not in a couple
00:04different ways. I mean, it sounds weird because it has to do with like the one generation
00:08passing on and then leaving their wealth, which I think nobody is ready for. But when it comes
00:12to financial literacy and how comfortable many women feel, you have some pretty alarming statistics
00:17from HSBC. Oh, great. So we did an incredible research report. We reached out to over 2,000
00:22individuals, over 1,000 women in the US. And it really was the intention of the fact that we've
00:26been talking about the great wealth transfer that's going to take place for quite a while
00:30at this point. And we really want to see what's the mindset of women and are they ready for
00:34this. And so when we talk about the fact that a trillion in assets are going to transfer
00:39to women, and women are going to control 45% of wealth around the world. So I stopped there
00:44because that's like a huge deal and very exciting. But the sobering part of the research came
00:48back and said only 29% of women felt that they could actually attain their financial goals.
00:53So when you think about are women ready for this transfer of wealth, with only 29% saying
00:58they're confident about that, that's where we then say we have a real opportunity to really
01:02provide financial literacy and financial fluency for women to feel a lot more confident about
01:08the fact that this is going to take place.
01:11So you see the title of the report was The Fluency Gap. So what is it in a nutshell?
01:17Yeah. So I think that the subtlety here, this is where we really want to move the conversation.
01:21So we've been so focused for the last couple of decades on financial literacy. And literacy
01:26is really just having the knowledge and having an understanding of finances. And the great
01:30news here is women are absolutely financially literate. That's the great news. What we're
01:34talking about here is the fluency. And the difference between literacy and fluency is fluency
01:38is understanding what to do, how to do it, and asking the right questions to accomplish it.
01:43So we're definitely getting the checkmark on knowledge. And what really gets me excited is when
01:47I look at baby boomers, baby boomer women, 60% of them are in the markets. That's amazing.
01:52But literally Gen Z, 75% of them are engaged in the market. So the knowledge is there,
01:58but we want them to have the confidence and the fluency to make the right decisions about their
02:03finances, but not on their own. It's the ability to ask the right questions of professionals
02:08to help women in those decisions about their finances.
02:11Raquel, how much of this fluency gap has to do with language? There's still such a big intimidation
02:16factor when it comes to finance, and it could be very exclusionary to a lot of people.
02:20How much does it have to do with the fact that there's a lot of jargon? That could be very
02:24intimidating. I couldn't agree more. So what is wonderful about leading wealth management
02:28and private bank for HSBC, one of the greatest things I talk about is our ability to connect
02:33with clients and very importantly, putting it in the language that they understand. And so what I
02:38always tell people about their finances, when you sit down with your advisor or any professional,
02:41it really says to them very simply, what's your hopes and dreams and what are you looking
02:46to attain? And it really is about you attaining your goals. It isn't about, quote unquote,
02:50your finances. And the idea here is how do my finances align that I can attain the goals
02:55that I've set for myself? So it is jargon and it's the language, but importantly, it's
02:59our job to make sure that we're making it attainable and understandable for our clients,
03:04women and next gen.
03:05So we're starting that conversation now before the time actually comes for that transfer.
03:09What are the ways for couples to talk about this, for Gen X to talk about this,
03:14millennials to talk about this and really communicate with baby boomers about this?
03:19Yeah. I think all of the above, and I'm happy you made that distinction because whether you're
03:23in your 20s, 30s, 40s, or 50s, or in that retirement age-
03:26I didn't say Gen Z. Sorry, Gen Z.
03:27Okay, that's fair. Well, they all count.
03:29Okay.
03:30And early is great. And no matter where you are, what stage, at any point, it's a great time to
03:35start.
03:36And to the exact questions that you're asking, the way that I look at it is less about you knowing
03:40the answers to the task question, because I feel like for women, we have this precision thing in
03:44us that we think we have to have the answers, which is why we shy away from having the conversation.
03:49But for me, it's about asking the right questions of yourself. And so it starts very simply with,
03:53how do we move past the literacy part, which is affordability? So if you're going to make a
03:57massive purchase, the question you ask yourself, can I afford that? But that's what I call financial
04:02literacy. The difference of the fluency, and there's something I call, which is part of this
04:05report, it's called the glow up. And I use a framework called glow. So the first question you need to
04:09be
04:10asking yourself besides affordability is glow. Gee, does this actually align to the goals that I've
04:15set for myself? I told you that important question you have to ask yourself. The second one is, if I
04:19really think about this, is this aligned to the lifestyle that I've identified that I want to
04:23attain? O is, what is the opportunity cost? If I spend the money on this big purchase, what am I
04:29missing out if I weren't in the markets? And then the last one is really about that wealth question,
04:33right? What is the wealth effect? Is this actually going to help me preserve my wealth? It's going to
04:37actually provide me the opportunity, accumulate wealth, or is this going to detract from my wealth?
04:42If you ask yourself those additional four questions, which is under the framework of glow,
04:46I then say you've moved into fluency. So it's not about having the answers. It's about asking the
04:50right questions, and then having the ability to say, decisions I make on X, what's the impact long term?
04:57So why is the financial industry still missing the mark? We've talked about the great wealth transfer.
05:02We've talked about the numbers, the amount of wealth that's going to transfer to women. Why
05:06is it still not getting it right? Well, I think it's hard if you think about the fact that every
05:11day you all wake up and you're focused at Bloomberg on finances. Unfortunately, one of the things that
05:16we all know fundamentally, financial literacy and financial acumen is taught nowhere. If you don't
05:22see it in your household, and if it wasn't discussed at your kitchen table, you really are teaching
05:25yourself. What has changed, though, quite honestly, is democracy of information. So your ability to use
05:30the internet, your ability to be, you know, using social media, and obsolete plugging into
05:37programs like Bloomberg, you have the opportunity to learn, but it's self-taught. And so the stigma
05:42that allows you to figure out the fact that you can actually feel confident in that conversation is
05:47where we now need to give women permission to understand, check on literacy. We really are confident,
05:53and you have to realize, stop using that as the excuse, but allow us to say, it's about the questions,
05:59and it's about figuring out where are my goals, and can I attain them? A couple of things that's
06:04important about women, too, that we have to realize. It's also the complexity of women. So
06:07what I do also talk about the fact is advice is generally driven around the historical trends of
06:12men, and it tends to be a little bit more myopic on a particular goal, which is retirement.
06:17Women have quite complex lives. We're very focused, so if you look at the research, we're very clear.
06:22Women are very focused not on themselves when it comes to their wellness, and more importantly,
06:27their wealth creation. They're very concerned about the next generation. They're very focused
06:31on their parents, and they're absolutely focused on giving and community. So when you're sitting
06:35down with an advisor, what I've also talked about the importance is understanding when you're talking
06:39to women, it's beyond the singular goal. It's around embracing the complexity of women and
06:45understanding their finances go way beyond themselves, and that's part of the conversation that
06:49needs to change as well. One of the really striking points in this report is that women's
06:54financial priorities have evolved way more than men's over the last several decades.
06:58Why is that the case? Can you please talk about that a little bit more?
07:01I don't know if I can answer the why, but I'm going to accept that it has, and so that's
07:05why
07:06it's important to make sure that if you're giving advice, be specific to the audience, and for women,
07:12you're right. There is more depth and complexity that you need to be able to address.
07:18I'm asking the man question, but how can men help?
07:22Excellent. Excellent. It's a great question. It's very simple. There's two ways. One,
07:27as a spouse or significant other, I'm very clear. Make sure your significant other and your children
07:33are in these conversations and meetings. The second one is, as you said it, how men can help.
07:39Majority of advisors are male, and so I'm very clear about when you are sitting across from
07:46a client, a male or a female, it's important that you understand the advice and the actual questions
07:52you ask of women need to look different, because their needs are different, and you have to have
07:57that uniqueness when you think about how I allow you to plan for your financial life.
08:00We're speaking with Raquel Oden, head of wealth and private banking at HSBC. Also with us,
08:05Claire Obusin, Bloomberg News senior editor.
08:10The way I'm thinking about this is that there's going to be a lot of money changing hands very
08:18quickly. One thing that we're trying to figure out is not just the economic implications of that,
08:24but also the changing way that women and men spend their money, because that can have serious
08:31economic effects. If we think about this, this economy is consumer driven. Is that on your
08:37radar? Does that shift the way that we think about consumer spending in the U.S.?
08:41I think 100% it shifts it. And I think for me, that's my point of why you see my
08:45excitement about
08:46the financial glow up. This is a really incredible moment for women. The way that we think about
08:51finances is different, and where we're going to put our attention and time is different. So we also did
08:55another report called The Giving Shift. And we did another research report focusing on women and men
09:01and how they gift very differently. Not one is right or wrong. They're just different. And so
09:06for men, generally giving tends to be more about a building with their name on it. What's different
09:12about women and giving... All right, all right, all right. Come on. The difference between women and
09:17giving, and we saw this in the research, it came back that women were very focused on local charities,
09:22places where they could touch and feel the community that they're impacting. So if they're going to give to
09:27a soup kitchen, they want to be in that soup kitchen. It isn't just about a name or giving.
09:31They really want it to be local in the local community. I think of your comment, I think of
09:34like Mackenzie Scott is a very prominent example of doing exactly what you're talking about, right?
09:41I mean, she could have given away billions of dollars and it could have been the Mackenzie Scott
09:44everything. But instead, her approach to giving is much different. I'm not saying not, you know,
09:49any of us are the wealthiest people in the world. It's not right or wrong. It's just different.
09:51It does illustrate the point that you're making. Yeah, it's just different. And she's giving in
09:55communities that one would say, not from her background 100%. And she did the homework. She's
10:00doing the homework. And the homework that women are doing when they talk about the giving shift
10:04is making sure, is that charity giving locally? What's the impact that it's going to have? And
10:10then additionally, whether I'm named or not, and I will tell you with the Mackenzie Scott,
10:13most of the time she doesn't want her name on it. And so that's a very different way of looking
10:17at it.
10:17But her billions of dollars, the impact she's having on society is incredible.
10:22Thank you for joining us.
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