Your Finance: Women hold purse strings

When Rachel Smith met with her first financial adviser, he talked to her like she was 5 years old.

"Whenever I had questions, he would just say, 'Forget that and listen to me,' " says Smith, 35, a New York real estate agent. "He was an older guy who was very condescending, and saw me as a young, inexperienced woman who didn't know anything."

The relationship didn't last long.

Fortunately, that kind of treatment is becoming less common, as financial advisers wake up to the fact that women control a lot of money and make good clients.

Women already are the primary financial decision-makers in most American households, according to a new survey by personal-finance site DailyWorth in which 76 percent of women reported being their household's primary retirement planner.

Moreover, women already have accumulated significant wealth -- some $8 trillion in assets, according to a study by TD Ameritrade Institutional, which provides brokerages services to investment advisers. It expects that number to balloon to $22 trillion by 2020, as baby boomer women inherit assets from their parents and their husbands, whom they typically outlive.

Not only that, women also have proven better investors than men, winning higher returns with longer-term vision and less inclination to trade frequently, according to new research.

In a paper titled "Boys Will Be Boys," academics Brad Barber of the University of California at Davis,  and Terrance Odean of U.C., Berkeley reported: "Models of investor overconfidence predict that men will trade more and perform worse than women . . . We document that men trade 45 percent more than women, and earn annual risk-adjusted net returns that are 1.4 percent less than those earned by women."

It is no wonder financial institutions are practically frothing at the mouth. All that cash is low-hanging fruit for financial planners, says Maddy Dychtwald, co-founder of consulting firm Age Wave and author of "Influence: How Women's Soaring Economic Power Will Transform Our World for the Better."

But women are wary of the boys-club atmosphere that has long epitomized the financial-planning world. Many, like Smith, find themselves patronized.

"When women are asked which industries do the best job of addressing their needs, financial services comes out at the bottom," says Eleanor Blayney, consumer advocate for the Certified Financial Planner Board of Standards and president of McLean, Va., consulting firm Directions for Women. "Financial advisers need to forge better partnerships with women and figure out how to win their trust."

Women tend to frame discussions in terms of the end goal: That might be putting the kids through college or caring for an aging parent or achieving financial peace of mind. That compares with percentage annual gain, which is what data-obsessed male investors often focus on.

"That's a big 'Aha moment' for many advisers," says Dychtwald of Age Wave. "It's not always about the returns. For women, their frustration comes into play when they show up and feel they're getting ignored or not listened to."

So what's the result of these diverging approaches to money? One is that women often pepper their financial advisers with questions, to the point that planners want to "tear their hair out," laughs Dychtwald.

But as an investing strategy, such a deliberative approach is usually the superior one.