How financial advisors can attract younger generation clients

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Millennials inherited a whopping $68 trillion from the baby boomer generation.

But they don’t necessarily listen to their parents about how to manage their money.

The rise of online money management platforms has given the younger generation more options than their parents ever had.

Many people choose to do it alone, according to a recent survey by the National Association of Personal Financial Advisers, showing that 62% of millennials are getting their advice online or from social media. festival. Only 21% said they primarily use a financial advisor.

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But there is still room for advisors to develop relationships with this younger group, according to experts who spoke at the CNBC Financial Advisors Summit on Wednesday.

Millennials have made it through 9/11, the Great Recession and now the Covid-19 pandemic, leaving 38% of them feeling sick, said Kristi Rodriguez, senior vice president of the National Retirement Institute. feel less optimistic, said Kristi Rodriguez, senior vice president at the National Retirement Institute. the firm.

That is changing their willingness to work with advisors. In 2016, less than 50% of millennials polled by Nationwide said they saw the need to employ an expert. In 2020, more than 75% said they’d like to work with an advisor to help them reduce risk and plan for retirement, says Rodriguez.

Jon Mauney, general manager at Betterment, said: “While it has become a joke that millennials have killed certain industries, that is not the case with financial advice.

“I don’t think millennials have killed or are killing financial advisors,” Mauney said.

But to appeal to young investors, between the ages of 25 and 40, advisors need to approach them differently than they would their parents.

Offering a more flexible approach, with a single price menu instead of a one-size-fits-all property percentage, tends to appeal to this younger generation, Mauney said.

According to Rodriguez, what tends to go a long way with millennials is making them feel like their mentors are trying to see the world from their perspective.

“They want you to really understand the ‘why’,” says Rodriguez.

Millennials also love to see diversity in the mentoring team in terms of age, ethnicity and socioeconomic background, she said.

The good news for financial advisors is that an introduction to this younger generation may already be available through their booming clients.

“Let’s say ‘bring your millennial kid, let’s have a more comprehensive conversation and put them in order,'” said Rodriguez. How financial advisors can attract younger generation clients

Emma James

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