Financial Advisers: Heed Gender Differences in Your Clients’ Communication Styles

Communication is key in relationships — not only in marriages and partnerships, but also between financial advisers and their clients. But, as we have all learned the hard way, it’s very easy to miscommunicate; albeit unwittingly.

Carl Richards, the certified financial planner behind the “Sketch Guy” column in the New York Times, is fond of telling a story about a conversation he and his wife had that illustrates this point. “My wife mentioned that her friend had recently redone her kitchen,” he writes in”Spouses and Bankruptcy Terror.” “As she explained all of the renovations, I started doing mental arithmetic that quickly added up to big dollars, dollars we couldn’t afford. Instead of engaging in a fun conversation about why my wife liked the kitchen and what she thought was cool about it, I responded with my typical ‘We can’t afford that.’ Of course when she heard my response, my wife gave me a confused look and said, ‘What are you talking about?’ What I took as code for, ‘I want a new kitchen,’ was just my wife talking about something she enjoyed.”

When Richards told that same story at a conference I attended, more than a few people in the audience chuckled knowingly. And so naturally my ears pricked up when I spoke with GenSpring Family Offices recently about their 2014 Women’s Retreat, which attracted about 150 women.

I asked Carolann Grieve, a family wealth adviser and co-chair of the firm’s Women & Wealth Initiative, which session had resonated the most with the audience. Without hesitation, she said: common grounds in communication and gender differences, presented by Deborah Tannen, a professor of linguistics at Georgetown University.

Tannen is also the author of many books and articles on how the language of everyday conversation affects relationships, including The New York Times best seller You Just Don’t Understand: Women and Men in Conversation.

I spoke with Tannen about some of the key differences in verbal and nonverbal communication styles between men and women. Perhaps not altogether surprisingly, the disparities in the ways adults communicate are rooted in childhood and the ways that boys and girls interact with their peers.

“I trace it to the way boys and girls use language growing up and their overall uses of talk and conversation in their relationships,” Tannen told me. “The pattern is that girls have a best friend, and it’s the talk that creates the friendship. Your best friend is the one you tell everything to. Boys tend to play in larger groups, it’s the activity that is central, and your best friend is the one you do everything with. So this focus on activity versus focus on talk to create closeness is going to be the basis for a lot of the differences you are going to find in adults.”

That doesn’t mean that boys don’t talk with each other. Of course they do, Tannen said. But boys tend to use talk to negotiate their status in the group: Who’s up and who’s down? Who’s center stage? Boys tend to talk about how good they are at something.

The focus for many of the girls and women is different: Does the conversation bring us closer or push us further apart?

For boys, the question tends to be: Does this put one of us in a one up or a one down position?

“That is the key thing to understand — the focus [of the conversation],” said Tannen. “It doesn’t mean that girls don’t have hierarchies, of course they do, we all know that, but the way it is negotiated often is ‘who’s in and who’s out?’ whereas for the boys, it’s ‘who’s up and who’s down?’ If the boys don’t like a boy, they don’t kick him out the way girls do, they allow him to stay, and they just push him around. The girls, because what they are doing is telling secrets, if they don’t like a girl, they lock her out.”

In a Washington Post article, Tannen explained the bridge between childhood and adulthood: “I believe these systematic differences in childhood socialization make talk between women and men like cross-cultural communication, heir to all the attraction and pitfalls of that enticing but difficult enterprise. My research on men’s and women’s conversations uncovered patterns similar to those described for children’s groups.”

These differences extend to nonverbal communication, too. “The way men and women sit when they talk to each other, beginning as kids, is very different,” Tannen said. “Girls and women tend to sit and face each other directly and keep looking at each other, and boys and men tend to sit at angles or parallel and look around the room; so that too can create frustration [for a couple]. She thinks he’s not listening because he isn’t looking at her.”

She adds: “For women, as for girls, intimacy is the fabric of relationships, and talk is the thread from which it is woven.”

These basic differences underlie why men and women have different expectations from communication – and why sometimes it’s very easy to misinterpret a conversation. But it’s important not to fall into the trap of gender stereotypes. As Tannen explained: “I often point out to my students that we are making a distinction between stereotypes and generalizations. Generalizations are problematic because they are not true of everybody, stereotypes are dangerous because they are conclusions you have drawn not based on fact.”

Why does all of this matter? American women today are more financially powerful than ever, controlling an estimated 8 trillion in assets in the US — or 51% of wealth. That figure is expected to jump to $22 trillion, or 67% of wealth, by 2020.

As a financial adviser, it behooves you to understand the communication dynamic between couples who are your clients, and between yourself and your current and future clients. After all, the core of the job is good communication skills.

To put this opportunity into perspective, Sallie Krawcheck, the former Bank of America and Citigroup executive who now owns Ellevate Network for women, recently characterized women as “an emerging market.”

According to Krawcheck, understanding and meeting the needs of an emerging client base is a top industry issue. “The challenge for all of us is to really look at what these emerging clients are looking for and deliver them. . . . What we’re talking about is a broader theme of ’emerging markets.’ I don’t mean BRICs, what I mean are emerging consumers of financial services, emerging consumers of wealth management services.”

So what do these “emerging clients” want from their advisers in terms of more effective communication? And how can male advisers improve their interactions with female clients?

Writing in Financial Advisor magazine, Kathleen Burns Kingsbury, author of How to Give Financial Advice to Women: Attracting and Retaining High-Net-Worth Female Clients, offered these tips:

• Women need to tell their story. Listen carefully so you understand her experience.
• Women get personal quickly. Female clients want to know that you have something in common with them.
• Women communicate using feeling words. Women connect through discussing their vulnerabilities and not through sharing activities.
• Women remember details and read body language. Making eye contact, communicating interest through nonverbal communication, and paying attention to details are very important in the female culture.
• Women are loyal. Because being in relationships is what defines them and brings them pleasure, women work diligently to establish, maintain, and preserve their personal and professional relationships. This loyalty is why women refer more friends, family members, and colleagues to financial advisers than men do.

With all that in mind, if there is just one piece of advice that I can relay from my conversation with Tannen that is especially relevant to male financial advisers working with female clients, it is this: “Women really value having their thoughts and experiences acknowledged.”

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

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