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The Modern Rich Woman Takes Care Of Her Money

Traditionally rich women achieved wealth either through inheritance or being married to a wealthy husband or family. However, today's women on their own, either through business or professional success, are earning independently to create wealth for themselves.

IIFL Wealth and Asset Management’s founder, managing director and CEO Karan Bhagat has seen many new money men and women manage their wealth. As a wealth management company that rose in popularity and success with this new breed of first generation wealthy, Mr. Bhagat speaks on how the modern woman is more interested and savvy in growing one’s wealth.

Do we see more self-made women joining the rich lists in modern times?

Women as a gender class have surely arrived in today’s world of rich, famous and powerful. While actual data may vary from various sources, self-made women, especially, first generation entrepreneurs and top earning CXO’s are entering the rich lists.

We are seeing a lot of women who have inherited wealth, using it professionally to further grow it. Thus, lady scions of business families are either taking over businesses to run them better or starting new businesses to enrich their wealth.

With the global economy in turmoil in early 2016, women struggled to maintain their share of the Forbes list of the World’s Billionaires. The total number of female billionaires fell to 190 from 197 last year, and women make up 10% of the world’s 1,810 ten-figure fortunes. But important to note in the Forbes report is that in last one year 27 women joined the ranks of the billionaires for the first time and another 3 returned to billionaire status after falling off in previous years.

What differences do you notice between younger High Net worth Individual (HNI) and older HNI women?

One clear trend that we see between younger and older HNIs is the higher awareness and knowledge of various asset classes. The younger lot also attends more meetings and reviews with the wealth management experts. These are ultra HNI women clients as well as wives, daughters and daughter-in-laws.

Younger women, when they are the key clients, are as astute if not more in their decisions as their male counterparts. Both men and women of younger generation display greater risk taking ability as their earning cycles are still ahead of them and therefore they have greater equity assets in their portfolio.

The younger lot is more widely travelled and have a global exposure much early; maybe, some of them have studied overseas in global universities or have done their first internship stint overseas. That is true for both younger men and women among the ultra HNIs.

Younger HNI women are also more networked and have a much robust peer group to exchange ideas for wealth creation.

Most HNI women are in what age range?

HNI women usually are from the age 35 onward. However, young women entrepreneurs or professionals with stock options that have seen interesting valuations hit the club much earlier.

How many of these HNI women actively make decisions in their companies versus number of men doing the same?

I think the distinction gets blurred among today’s generation as most HNI’s – either men or women, are educated and professionally competent. So whoever is at the helm takes the decision – competence has become the most critical factor.

Some of the lady CEOs, professionals and entrepreneurs are taking decisions independently and are well-informed.

When it comes to asset management, do HNI women take an active role or delegate to someone?

Today’s HNI women are both informed and aware. And they take active role to manage their wealth. However, we have noticed that in a family office very often the process includes views from the entire family but one person from the family (basis interest and competence) taking a dominant role in decision making and conveying it to the wealth management experts.

As a trend there is greater awareness among women of asset classes other than jewellery and property for investment purposes.

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