Millennial Financial Advisors

One of the biggest ways in which Millennial financial advisors will drive permanent change is through their high expectations for the role of technology in delivering advice and communicating with their clients and prospects. Learn more…

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    Millennial Financial Advisors

    Millennial Financial Advisors

    Every generation makes its mark — the Millennial generation is no different. We already see signs of how Millennial financial advisors are changing the landscape of the financial advisory business.

    One of the biggest ways in which Millennial financial advisors will drive permanent change is through their high expectations for the role of technology in delivering advice and communicating with their clients and prospects, whether through social media, text, chat, or video.

    Millennials will not only expect leading-edge technology but will demand that mobile tools be fully integrated with other tools that may sit on a technology platform. They will also increasingly press for more latitude with social media to generate new business and communicate with clients. In other words, they want high tech to enable high touch.

    In an era of “big data,” Millennials will want access to data to inform their marketing efforts and personalize their client servicing.

    Broker/dealers or Registered Investment Advisor (RIA) platforms that fail to rise to these expectations are likely to stagnate as older Baby Boomer advisors retire and Millennial advisors gravitate toward those firms that have relevant and responsive technology.

    Millennials have a different perspective on wealth management than their older peers. Contrary to the stereotype of a generation hunched over their smartphones eschewing direct human contact, Millennial advisors are more relationship-oriented (with a disdain for traditional sales practices), placing a greater emphasis on their clients’ non-financial lives. Moreover, they emphasize social responsibility in the investments they recommend and how their practices engage with their communities.

    This may mean that some firms will need to be more patient with Millennial financial advisors in reaching profitable client asset levels since building a business that way takes longer. Arguably, though, it will be a more sustainable client book that is built.

    Existing players will also need to be more welcoming to alternative pricing. Commissions are likely to fade away after a time, but the asset-based fee model can’t be the only option for Millennial advisors or Millennial clients.

    This is a generation that has grown up very comfortable with subscription-based pricing, so expect to see more of that in the future. Anticipate other pricing models to emerge, as well, like flat quarterly pricing, hourly fees, and project-based fees.

    Finally, as with most Millennial workers, they will want a healthy work-life balance, flexibility in their work schedule, and to work for an employer that seeks to make a positive impact on the community.

    The Millennial advisor, however, will remain like generations of advisors that preceded him in that he is hard-working, competitive, and smart; but, sadly, still mostly male.

    Please reference disclosures: http://blog.americanportfolios.com/disclosures/ 

    About The Author

    Kimberly A. Branch, CFP®

     

    Vice President of Marketing Strategy 
    631.439.4630 

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