I know what you’re thinking: why bother? Millennials – also known as Generation Y – are young, lazy, and entitled.
At least that’s the stereotype. Many businesses and industries don’t see a lot of upside in going after them. The safe bet is targeting Gen Xers and their Baby Boomer parents, right?
Millennials – usually considered those between the ages of 18-34 – are a misunderstood bunch. But with roughly $2 trillion in assets about to switch hands – Baby Boomers to their X and Y offspring – in the next five years, you’d best start to understand them. And fast. They’re the largest market out there.
Consider the numbers:
- Approximately 2 billion worldwide
- 23.4% of the US population, or 75.4 million (making them the biggest group, having recently passed the Boomers). Some estimates put their US total at 92 million (depending on the age range used in their definition).
- Millennials will represent 75% of the global workforce by 2025. That’s less than 10 years from now.
Do you need them? As a financial advisor, should you go after them? Yes!
The Millennial Profile
Everything you think you know about them is probably skewed by the media. Yes, they’re young. Yes, they tend to have some entitlement issues. But they’re also well educated, motivated, and ambitious.
Millennials are 2.5x more likely to be an early adopter of new technology than previous generations. They’ve grown up in a digital world. They expect a product, service, or “employee” to reflect that.
When it comes to their money and wealth management, they are – perhaps surprisingly – more conservative and less trusting than older generations. A survey by Accenture found that 43% described themselves as financially conservative, and 28% are unwilling to act on advice from their advisor without consulting at least one other source.
So you’ve got to win them over. You’ve got to focus on building a relationship, and earning their trust. And you do that with personalized attention and advice. Know them…their situation, goals, and fears.
Passing on Wealth
That same survey also discovered that millennials are more concerned with passing along wealth to their family – 40% listed it as important – and they’re the group most determined to learn about investing – 44% described themselves as “extremely interested” in improving their understanding of investing and the financial world.
What does that mean to you and your wealth management business? Education opportunities are key. Provide online resources, free webinars, community portals and discussion boards to share ideas and ask questions. Offer high quality and useful content to help them increase their financial knowledge. Make yourself available to connect and engage with them.
Gen Yers are tech-savvy. They love, use, and expect high tech and modern tools. Nearly 70% of investors look for tech options when choosing a financial advisor. They have no patience for lack of or clunky digital offerings and user experiences. You need to provide them with the tech “toys” they want: make it intuitive, accessible, mobile, and engaging.
Millennials Are Online
Contrary to popular opinion, millennials don’t live exclusively online. It’s their preferred medium, yes, but they also like some real world, face-to-face social interaction. Make time for that in your interactions with them. Informal chats are their second most preferred channel for one-on-one communication after email (Connecting With Clients, 2013).
But you do need to put some effort into your online presence, too. Millennials spend an average of 25 hours/week online (AdAge). Reach, connect, and engage with them where they spend their time. They consume content like no other generation before them. Give it to them. Craft a website and/or blog. Participate on social media platforms. Your efforts there will serve double-duty as more effective and powerful marketing. 84% of them don’t trust traditional advertising (The McCarthy Group), but they’re 247% more likely to be influenced by websites, blogs and social media. When they see you there, and consume your content, and read reviews and recommendations from friends, family, and even strangers online, you’re well positioned when they need to find an advisor of their own.
According to the 2016 Connected Investor Report by Salesforce, only 24% of investors are managing their assets in collaboration with their advisor…but 63% would like to be doing so. Make collaboration a linchpin of your service. Provide that where so many others are falling short.
Millennials are not unreasonable, or surly, or churlish. They are a growing segment of wealth management market, though, and you need them in your roster. They know exactly what they want, and if you can deliver those very modest expectations, you’re in. Education opportunities, online and offline interaction, collaboration, trust, and digital offerings are key.