Four ways to help women-owned businesses

Many women-owned businesses aren’t working with a financial professional and could benefit from professional guidance. Just 77% of women business owners said they work with a financial professional for business goals, in the Allianz 2023 Women-Owned Business Study.* That leaves many women-owned businesses without financial guidance.

Women-owned businesses could benefit from personalized guidance and are unique clients for financial professionals. And the vast majority of owners (92%) said it is important for an advisor to have experience and knowledge in issues specifically related to women-owned businesses.

Here are four ways you could help them.


Connecting with opportunities

Many women business owners have not taken advantage of beneficial certification programs, federal contract programs, or a support organization. Nearly one in five (17%) say they have not determined their eligibility for these opportunities. A savvy financial professional can help connect women-owned businesses with these programs.

For example, businesses that are certified as a women-owned business through the U.S. Small Business Administration are able to gain federal contracting opportunities through the program. While 70% of the business owners in the study were certified through the program, just 54% have participated in a women-owned small business federal contract program.


Easing economic concerns

Women business owners are particularly concerned about economic risks like recession, rising interest rates, and increasing costs of employee benefits.

  • 82% worry about a recession or significant market downturn
  • 80% worry about rising interest rates
  • 71% worry about increasing costs of employee benefits

A financial professional can help ease these concerns through various risk mitigation strategies for long-term financial success. With its death benefit protection, accumulation potential, flexible access to cash value, and tax advantages, fixed index universal life (FIUL) insurance can help women business owners address economic issues.


Recruiting and retaining key employees

Many business owners are concerned about retaining their key employees. The majority (79%) said they have key employees who are critical to retain throughout an ownership transition, and 62% said they are concerned about difficulty attracting and recruiting. Strong compensation and benefits can help owners recruit and retain key employees.

A financial professional can help identify which employees are truly key to ongoing success, tailor the plan to those workers, and communicate the strategy with the individual employees.

For example, a fixed index universal life (FIUL) insurance policy can provide a number of different forms of compensation and benefits that an employer may offer to help recruit, retain, and motivate key employees. An FIUL policy can provide a death benefit,1 accumulation potential, tax deferral, and flexibility for loans and withdrawals2 into an employee’s overall compensation and benefits package.


Succession planning

Succession planning for a small business requires careful preparation so that the business can succeed through a transition. Many women-owned businesses may need help in selling or transferring ownership. More than half (56%) said they do not have a plan for transitioning out of ownership. And 31% said they plan to transfer ownership within the next 10 years.

A financial professional, in concert with the business owner’s team of professionals, can help these businesses create a written succession plan to achieve the owner’s goals.

FIUL may be a good choice to help with business succession planning, as it can play a role in various strategies to fund the transfer of a business or provide some level of protection to the parties involved. In buy-sell agreements, FIUL can help ensure that all parties involved have sufficient liquid assets to meet their obligation under the agreement.

Women-owned businesses are an important part of the economy and could benefit from professional financial guidance. A financial professional can help women-owned businesses by connecting them with opportunities, easing their economic concerns, and assisting with employee retention and succession planning.

*Allianz conducted an online survey, the 2023 Women-Owned Small Business Study, in April and May 2023 with 211 owners of small- to medium-sized businesses with at least five employees and at least $500,000 in revenue the last fiscal year.

1 The death benefit is generally income-tax-free when passed on to beneficiaries.

2 Policy loans and withdrawals will reduce the available cash value and death benefit and may cause the policy to lapse, or affect guarantees against lapse. Withdrawals in excess of premiums paid will be subject to ordinary income tax. Additional premium payments may be required to keep the policy in force. In the event of a lapse, outstanding policy loans in excess of unrecovered cost basis will be subject to ordinary income tax. If a policy is a modified endowment contract (MEC), policy loans and withdrawals will be taxable as ordinary income to the extent there are earnings in the policy. If any of these features are exercised prior to age 59½ on a MEC, a 10% federal additional tax may be imposed. Tax laws are subject to change and you should consult a tax professional.

Product and feature availability may vary by state and broker/dealer.

Guarantees are backed by the financial strength and claims-paying ability of Allianz Life Insurance Company of North America.

Products are issued by Allianz Life Insurance Company of North America, PO Box 59060, Minneapolis, MN 55459-0060.

This content does not apply in the state of New York.

For financial professional use only – not for use with the public.