When you think of the term “millennial,” what springs to mind? Certainly this generation has dealt with its fair share of less-than-flattering stereotypes. However, it’s important for advisors not to pigeonhole millennials when it comes to financial advice. Why? Because millennials have grown up—they’re adults now. And they deal with challenges that previous generations may not have faced, which highlights the impact of a financial professional’s role now more than ever.
Benefits of Working With Millennials
Even though millennials have been labeled as entitled, picky, and impatient, they have good qualities too. Millennials are intentional about making choices that align with their values. They like to work for companies that boast a greater purpose to make the world a better place to live. They’re achievement-oriented and love to collaborate to solve problems.
But besides these good qualities, there are three main reasons why financial advisors might want to start setting their sights on millennials.
Majority of Workforce
As I said, millennials now make up the majority of the workforce. They’re in the early wealth-building stages of their lives. And although they’ve gotten off to a rocky start after the Great Recession of 2008, many have found success as entrepreneurs and in higher-level positions in their careers.
Over the next couple of decades, millennials will replace older generations as investors and real estate owners, so they’ll need financial advisors to guide them toward financial success.
Inheritance From Older Generations
Millennials are also projected to inherit over $68 trillion from their baby boomer parents by the year 2030. Some believe that millennials will be the richest generation in history after this wealth transfer occurs.
And huge inheritances will mean that financial advisors are in high demand.
Growing Complexity of Financial Needs
As millennials get older, their financial complexity keeps growing. In fact, I’m one of the oldest of the millennial generation and I need help from my advisor with all of the following:
- Retirement planning
- Tax planning
- Life insurance
- Real estate
- College planning for my kids
- Long-term care planning
- Estate planning
Because of the life stage millennials are in or approaching, they have a multitude of financial planning needs you can help with.
What Millennials Need From You
Working with millennials might seem less desirable than serving older, high-net-worth clients. But financial advisors who choose to work with millennials now are playing the long game. This could ensure the success of your business for decades.
Millennials do come with unique challenges, and financial advisors may have to adopt new strategies in working with them. Below, I explain a few things to be aware of that millennial clients might need.
1. Debt Repayment Plans
Millennials are reckoning with enormous amounts of debt, mostly stemming from student loans. At this point in their financial journeys, millennials need advice on debt repayment plans. They’re looking for strategies to pay off their debt faster. As an objective financial advisor, you can offer them strategies and plans that millennials may not otherwise see as options. They need your advice on how to grow and manage their net worth so that they can develop into the high-paying clients you want to see down the road.
2. Comprehensive Financial Planning
In addition to debt repayment plans, millennials need comprehensive financial planning advice. They need help starting or boosting their retirement plans and saving as much as they comfortably can.
Millennials are also increasingly entering the real estate market. Most millennials state that the biggest obstacle they face when it comes to purchasing a home is not being able to save enough for a down payment.
Helping your millennial clients set realistic savings goals—and keeping them accountable to those goals—will bolster millennials’ confidence in your expertise and advice for years to come.
Not surprisingly, millennials may not have the capital right now to meet your minimum investment requirements. If possible, you may want to consider lowering your minimums for millennial clients in the early years to develop relationships that could pay off in the long run.
3. Virtual Availability
Millennials prefer to work virtually as much as possible and spook at the prospect of phone calls and in-person meetings. Even before the COVID-19 crisis compelled many companies to switch to remote operations, millennials were already working online and seemed to prefer careers that allow for flexible remote-work options.
As first-generation digital natives, millennials are comfortable using online spaces in almost all areas of their lives. And millennials often work multiple jobs to make ends meet, so they appreciate saving as much time as they can by scheduling meetings and other work online.
In fact, a recent study found that 98% of millennials already use the internet to manage their finances. They’ll likely be comfortable meeting with you virtually and using screen-sharing options to go over financial documents and plans. If you’re able to accommodate millennials’ online preferences, they may be even more inclined to work with you over other financial advisors.
4. Reassurance
Perhaps most of all, millennial clients want to know that they can trust you. They want to understand your process and know that you’re working with their best interests in mind.
Millennials have been through two financial crashes since reaching adulthood, so they’re skittish when it comes to investing in the stock market and buying their first home. Your reassurance in these areas—as well as your transparency—encourages millennials to put their money to work for them.
Millennials value education and transparency. Most advisors we work with value client education as well. You won’t find more eager listeners or invested self-educators than millennials, and you may find their enthusiasm for what you do to be rewarding in and of itself.
Keep Your Business Growing by Attracting Millennial Clients
Ultimately, millennials aspire to improve their own lives and contribute positively to the world around them. We anticipate that in the coming years, millennials will increasingly seek out financial advisors for guidance and support. Advisors who intimately know and understand millennials’ specific needs are positioning themselves for long-term success with this demographic.
If you need help marketing in the digital landscape and tailoring your firm to appeal to millennials, we’re here to support you! We’ll begin by aligning your marketing approach with the specific preferences of millennial clients. Schedule your complimentary consultation with a marketing expert today—receive personalized recommendations on effectively engaging with the next generation to keep increasing the growth of your business for years to come.
