Change Required for Financial Advisors to Engage Millennials

There’s a lot written these days around the challenges in effectively reaching Millennials (those born roughly between the early 1980s and early 2000s). Having grown up in a technologically-enabled world with an unprecedented amount of information and options at their fingertips (literally, it just takes a swipe), they have a distinct set of experiences and expectations that define their generation.

With an estimated $7 trillion in liquid assets under their control by the end of the decade, financial advisors are understandably trying to garner their share of this valuable market.

 However, based on a recent article in Investment News, they’ve got a long way to go.

 As millennial who works in the industry, the author is candid in her assessment and recommendation: financial advisors can be trustworthy and convenient guides to money management for Millennials but need to focus on the following 5 key areas:

 1. Educating them on critical concepts such as diversification and market volatility so that they are more comfortable focusing on long-term growth and helping them avoid their inherent short-term bias.

 2. Providing crystal clear transparency on products, services, business models and fees. As the most ‘sharing’ and transparent generation ever, they want honest, open discussions about their investment options to counter the rampant skepticism associated with the financial industry as perpetuated through the media (which the Millennials avidly consume).

 3. Make it easy. This generation is all about the convenience and leveraging technology (particularly their phone) whenever and wherever possible. And if the process is fun, all the better.

 4. Financial advisors need to branch out and use the social technologies to engage Millennials on their terms. Meetings no longer have to be in-person (they don’t want to come to your office so use other tools) and information doesn’t have to come in paper (think blogs instead).

 5. With high levels of student debt and salaries that in many cases have not risen at the same level as the cost of living, Millennials are cash-strapped. Therefore beyond the simple transparency of fees, they want options (such as an hourly fee) that meet their current needs.

 There’s a lot of money at stake with this generation. If advisors want to capitalize on the opportunity, it’s all about understanding – and addressing – their psyche, beliefs, fears, and values.