By Cheryl Hall
The Dallas Morning News
WWR Article Summary (tl;dr) Nine out of 10 women will be the sole financial decision-makers in their households at some point because their spouses die, they get divorced or they were never married.
The Dallas Morning News
Kathleen Murphy is fed up with the investment world being created by men in the image of men at the expense of women.
And, as president of personal investing at the financial giant Fidelity Investments, the 55-year-old is in a position to do something about it.
Murphy, who’s been in this high-command role for nearly a decade, oversees the management of $2.5 trillion — yes, that’s a “t” not a “b” — held in nearly 20 million individual client accounts. That includes more individual retirement accounts than any company on the planet.
She leads more than 14,000 employees nationwide and was here recently to visit her five North Texas investor centers in Dallas, Fort Worth, Irving, Plano and Southlake, and a regional customer contact center in Westlake.
From Murphy’s vantage point, women are underserved and often dismissed as irrelevant.
Look at the numbers, and you’ll see how wrongheaded this is, she says.
The United States is in the midst of a two-decade, $22 trillion shift in assets to women, who now make up the majority of the U.S. population.
Unfortunately, too many women aren’t mistresses of their financial universes. She wants them to take command before they’re thrust into that role.
“I say to women, ‘You’re working pretty damn hard for your money, right? There’s a reason you’re working so hard. It’s to enjoy your life, to fuel your dreams. So get that money to work hard for you,'” Murphy says during her North Texas visit.
Her message to women: Break the intimidation cycle.
The statistics are anything but pretty in pink.
Nine out of 10 women will be the sole financial decision-makers in their households at some point because their spouses die, they get divorced or they were never married.
“I do these big events where I say, ‘Ladies, you can bet on being one of the 10 percent and not learn even the basics or you can play the odds and think you’re going to be part of the 90 percent and take control of your financial future,'” she says.
Murphy spent 15 years in legal and government affairs positions at Aetna and eight years at ING U.S., moving up to CEO of wealth management.
She shifted from health care to financial services after watching what her mother went through when Murphy’s father died at 57, leaving her mother with three kids in college and little knowledge of how to handle finances.
“That happened to my mother when she was 54,” Murphy says. “But what if you’re in your 70s or 80s? You can see that I’m passionate about this.”
No mumbo jumbo
Under her leadership, Fidelity is changing the way it woos, talks to and serves women. And Murphy believes that by doing so, Fidelity is also drawing in millennials, people of color and anyone else who feels slightly spooked by financial planning.
“Investing’s not hard, but the way we talked about it made it too complicated. Alpha, beta, quant,” she says, ticking off financial jargon. “This is not a way to engage people.”
For starters, Murphy wants more women to understand the difference between saving money and investing it. “If you’re simply saving your money, you’re actually losing money, because inflation is running higher than banks are paying.”
Once women move their savings into investments, they tend to be as good or better than men in the returns they generate, she says. “Why? Because women, in general, have goals in mind, and they plan for the long term.
“Men, in general, focus more on shorter-term performance. ‘How am I doing today?’ ‘What’s the market doing today?’ Don’t get me wrong, we love men, too.”
Pumping iron
Murphy — who goes by Kathleen in professional settings but is Kathy or Murph to colleagues and friends — attributes much of her success to her upbringing in Wallingford, Conn.
“My parents had pretty fundamental rules: kindness, loyalty, stick up for your brothers and sisters,” Murphy says. “We walked to school. It was such a nice, Beaver Cleaver life. But we didn’t have a lot of money.”
She’s the third of six kids, sandwiched between an older brother-sister pairing and another grouping of a younger sister and two brothers, in an Irish-American household where duties were supposed to be split along traditional boy-girl roles.
“I kinda rebelled against it,” she says. “I make great chocolate-chip cookies. That’s pretty much it when it comes to cooking. With three brothers, I got used to the concept of aggressive males early on. I’m not going to cede the territory, ya know.”
The family was gender neutral when it came to haircuts, Murphy recalls. “We all got marched to the local barber and got the same little short haircut because it was the cheapest in town.”
It’s one reason she keeps her hair long.
The Murphy brood went to the Converse factory store for $5 shoes once a year and to the bank monthly to deposit their babysitting and lawn-mowing money — they didn’t get an allowance — into passbook savings accounts where they could see their money grow.
At 5-foot-8, Murphy excelled as a forward in basketball and as a backstroke swimmer, helping the Sheehan High School Titans become state champs three years in a row.
“I was terrible at swimming at first,” Murphy says. “But I just loved it. I stuck with it.
“I was into swimming when the East German women were bulking up. I was very bulky, too. I could bench press more than my older brother. I didn’t take steroids, but I did lift weights and practiced for hours and hours and hours.”
Legal eagle
In 1984, she completed her dual-major degree in political science and economics at Fairfield University, a private Jesuit Catholic university in Connecticut.
“I didn’t have any idea of what I wanted to do,” she says. “I remember very distinctly being interviewed to be a manager for a local Dress Barn. I came out of that interview thinking, ‘OK, I don’t know what I want to do, but I know it’s not that.'”
At the suggestion of a professor, she went to law school at the University of Connecticut.
In her first year, Murphy worked for a professor’s small law firm that did everything from death-penalty cases to representing the local nudist camp.
“I didn’t even know there was a nudist camp in Connecticut,” she says, laughing.
That summer, she worked for Aetna, which had the largest law department in Connecticut with 150 lawyers.
The next summer, she interned at a big Wall Street law firm.
“I remember being in the firm’s law library late one night, and there were two lawyers who’d been out of law school for four years, and they were so excited because they finally got to do a set of interrogatories,” she says. “I decided at that moment: ‘I’m not willing to pay this kind of dues.’ I decided to take a job at Aetna for half the pay and twice the responsibilities of the New York law firm. I got to do real interesting stuff real quickly.”
Zoë Baird, president of the New York-based Markle Foundation, was her boss and mentor at Aetna. Now Murphy sits on Baird’s nonprofit board.
“Kathy started out working for me, but over the years, I have called on her counsel at critical junctures in everything I have done,” Baird says, adding that her friend has always been a shining star, even in her early days at Aetna.
“Kathy has a unique combination of brilliance paired with a down-to-earth presence that enables her to relate to all kinds of people. She is able to see subtle elements within issues that others can’t and deliver remarkable insight — wrapped in that homey accent of hers so that it’s easily understood.
“She’s been a wise board member, helping Markle understand the evolution of the labor market and the opportunities ahead,” Baird says. “She is deeply committed to everything she does, and we at Markle have felt it every day.”
Managing 13 digits
Fidelity came calling in 2008.
“When Fidelity calls, you take the call,” she says. “And it’s Boston — for a kid who grew up in Connecticut, right? We were Celtics and Red Sox fans, and we became huge Patriots fans.”
She was drawn to Fidelity by the leadership of founder Ned Johnson, now chairman emeritus, and his daughter, Abigail Johnson, now Fidelity’s CEO.
“You get yelled at by Ned or Abby if your operating margins are too high, because it means you’re not investing in the value of the customer or the value of the long-term business,” Murphy says.
As an aside, Ned Johnson’s first geographic expansion was to North Texas after the blizzard of 1978, when Boston was besieged with a record 27 inches of snow and he had to put on skis to get to the office. It has 5,400 employees here, primarily at its regional site in Westlake.
Murphy sees too few women and people of color among her ranks.
“We’re not going to accept the fact that less than a quarter of the financial industry is women,” she says. “On the gender side, half of our new hires in our branches nationwide have been women for the last three years.
“It’s not like, ‘Oh, if you just try harder, you’ll get them,'” she says. “You have to take a step back and say, ‘What’s the environment they want to work in?’ Here’s the thing — and I say this to the folks all the time: ‘Let’s examine our policies, and are they a turnoff?'”
Hours are a good example. She doesn’t care when or how people get their work done, as long as they do.
“By the way, it’s not just women who want to see their kids play soccer on a Friday afternoon. As we’ve made our policies and practices more flexible, everyone’s benefited.”
As for results, Fidelity’s client investments grew 20 percent in 2017 — its sixth consecutive year of record growth.
Murphy’s division made news in August when Fidelity announced the industry’s first zero-expense stock-index funds, cut fees on other index mutual funds and did away with investment minimums.
It was enough to move her up a notch to the 34th spot on Fortune’s list of the 50 most powerful women in American business.
Does Murphy have trouble wrapping her mind around the idea that the company she runs manages a 13-digit figure?
“I don’t think about the 2.5 trillion because it’s a meaningless number,” she says. “We have customers with hundreds of millions of dollars with us right down to millennials with the first 0 that they’re investing.
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We have to think of them as people and what we can do best for each of them.”
Kathleen Ann Murphy
Title: President, Fidelity Personal Investing
Age: 55
Born: Wallingford, Conn.
Responsibilities: Oversees management of $2.5 trillion in nearly 20 million individual client accounts and leads more than 14,000 employees nationwide
Education: Bachelor of arts in economics and political science, Fairfield University, 1984; juris doctorate, University of Connecticut, 1987
Personal: Married to George Hornyak for 29 years. They have a 16-year-old son.
