Connecting Advisors With Future Clients

Along with global modernization as the new generation starts to enter the financial world, advisors are in for a challenge of transformation. The next generations, known as X (born between 1965 and 1980), and Y or the millennials (born between 1981 and 1997) will soon be the ones facing them and asking for their expertise, given that the baby boomers are nearing their retirement years. In order for them to cope with this transition, they must be able to determine what their latest customers want, prioritizes, and look for in an advisor.

The first important information to decipher would be the demographics. In a study conducted, it was found out that Gen X’s fortune is expected to triple to $37 trillion by 2030 while Gen Y is forecast to increase their net worth to $20 trillion by the same time which will be largely due to a robust workforce performance and booming saving rates. However, it should also be taken into account that only 52% of them consider having an advisor.

Despite various claims on what the next generation’s criteria in choosing an advisor which ranges from the ability to work with family to a heightened use of social media, a research of present clients revealed that none of these are true. Instead, they seek advisors with ample experience and comprehensive outlook. They also have high preference for a fee based system rather than a commissioned one. Millennials, on the other hand, share a quite different view, as they dwell more on the affordability of the service rather than experience.

So how would advisors win the hearts of their soon-to-be clients? An initial step would be to understand their goals and priorities, For example, it was discovered that retirement is the least of millennials’ reason for preparing themselves financially, and their main focus is on avoiding larger expenditures. Gen X, meanwhile, are more concentrated on being settled when they retire, and expenses such as their children’s tuition fees comes as secondary only. Using this as basis, advisors need to prepare themselves and shift their targets not only in retirement but asset protection and volatility control as well.

Another way of gaining the upcoming generation’s trust is to keep pace with their thinking and what they are familiar with. In this case, it would be helpful to adjust strategies and incline them to what is popular and more convenient for individual nowadays, such as resorting to social media and technology.