Good morning, Broadsheet readers! Oprah Winfrey will leave the WeightWatchers board and donate her company shares, author Marianne Williamson reenters the presidential race, and women will reshape how wealth is allocated, according to a new survey. Have a terrific Thursday!
– Closing the wealth gap. The Great Wealth Transfer that is expected to occur over the next two decades will see more than $80 trillion changing hands between generations in the U.S. alone, according to some estimates. Women are expected to receive a big share of that, in large part by inheriting money from male spouses who pass away, on average, years earlier. Millennial women are also set to inherit a fair share.
A new report from women’s investing platform Ellevest finds that the ‘feminization of wealth’ will have a profound impact not just on the individual women who receive it, but on society as a whole.
For the report, Ellevest surveyed 2,041 adults earning at least $150,000 per year or with a net worth of at least $750,000—the type of people who are most likely to benefit from the Great Wealth Transfer, given the current unequal distribution of wealth in the U.S.
The survey finds that “a fundamental shift occurs when women receive a financial windfall:” It significantly increases women’s confidence. In fact, it almost doubles it: 45% of all women said they’re confident with money, while 81% who received a windfall said the same—making them even more confident than men. Investing was the top priority for those who came into money, with millennials and Gen Xers also ranking “investing for impact” highly.
“It’s not that women have less money because they have less confidence, as so many assume,” Ellevest notes. “Instead, it’s the gender wealth gap itself that drives the money confidence gap. And the very act of getting a windfall, or expecting a windfall, is enough to wipe this out.”
Sallie Krawcheck, Ellevest’s CEO and cofounder, says while women are still discounted as an economic force, the Great Wealth Transfer could lead to a seismic shift. Progress in women’s financial empowerment has stagnated in recent years, Krawcheck says. Despite efforts like Lean In and the media’s focus on gender wage and wealth gaps, the needle has hardly moved. Women are still underpaid relative to men, and women leaders remain rare at the largest companies and in government. Krawcheck sees the Great Wealth Transfer as a real catalyst for enduring change.
“Women’s longevity is going to do what Lean In did not,” Krawcheck tells Fortune, and “get money into the hands of women.”
When that happens, expect the beneficiaries of money to change, Krawcheck says, pointing to wealthy women like MacKenzie Scott, Melinda French Gates, Laurene Powell Jobs, and Dr. Ruth Gottesman, who announced this week she is giving away $1 billion left to her by her husband to make tuition free for all students at the Albert Einstein College of Medicine. These women are giving away their wealth to important causes and helping to reshape society, Krawcheck says.
Many other wealth managers expect other women who inherit money in the coming decades to do the same, and research backs up that thinking (of course, not every woman will give away all of her wealth; but the differences between men and women are notable). Ellevest points to others who stand to benefit: People who do business with women, whose customers are women, who are funded by women, the list goes on.
“It may feel like a stretch, but women are more likely to donate to causes that support the climate, to nonprofits that support women and girls, that support education,” says Krawcheck. “What is a world when wealth is feminized? It is a better world, for everybody.”
Alicia Adamczyk
[email protected]
@AliciaAdamczyk
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