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Posted on October 3, 2016

What Millennials Really Want In Their Financial Advisor

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Published by Ron Carson

In the 1950s crime show Dragnet, sergeant Joe Friday would often tell over-wrought witnesses, “Just the facts, ma’am.”

That’s a little how millennials want to work with their financial advisors, based on the findings of the Millennial Advisory Council my firm set up recently.

While their parents’ generation often chose a financial advisor after having coffee and trusting their gut instinct, millennials told us they want concrete evidence that our professionals do what they say they will do. Being sold is a huge turnoff. They want us to be transparent and put how we do what we do on the table—along with our prices—so they can decide if it works for them.

That was just one of the key findings we took away from the Millennial Advisory Council we held this year to make sure our firm appeals to young adults. It was just as interesting as the council we set up with our female clients. There were some other key findings that intrigued me:

Time is money. Millennials treat money as a tool to attain life experiences. They would rather experience more now and save less than save more and hope to have experiences later. They “work to live” rather than “live to work.”

Freedom is their currency. Millennials seek freedom, be it financial or the ability to pursue their passions. They want to do work they love, enjoy working from home–and may choose a lower paying job to get equity in a startup. And they aim to retire earlier than previous generations—ages 35-55. Many think they need $3-4 million to achieve that goal.

Their advisor is a key part of this. They want someone they can trust and who delivers value—so they are free to pursue what matters to them. They don’t mind paying a fee if the advisor delivers the goods.

They do their homework. Content marketing matters to this group. They visit your site, read what you’ve posted there and think about it. They trust others in their age group to give them true feedback about the experiences they are having with an advisory firm.

Posting someone else’s canned content loses credibility with them instantly. They look for original content and third party endorsements. They truly want to know whom they’re engaging with.

They want things customized. Contrary to what some in our industry believe, millennials don’t necessarily want a robo solution. They want everything customized to their individual preferences: communication, meetings, reports, frequency, etc. They don’t want to receive information about general topics like long-term care that aren’t relevant for their stage of life.

Not surprisingly, they want immediate access to their accounts and the ability to log in right away. They prefer summaries to detailed information. If they ask for information, they want it readily available.

They demand accountability. Millennials want a single point of contact they can hold responsible for their account, even if there is a team backing up their advisor. They prefer an advisor who is passionate about his or her investment choices over someone who references their research team. They also want to know what differentiates one advisor from another—and don’t want to it to be explained to them in jargon.

They like to save time. They don’t like long meetings and would rather have 2-4 short meetings a year over a lunch hour than to hunker down in the conference room for hours. They prefer informal group discussions over presentations and want to discuss why money was gained or lost. They’re spontaneous and don’t want to have to schedule meeting a month in advance.

They’re entrepreneurial. When it comes to educational seminars, their favorite topics tend to veer away into investing and into subjects such as how to form an LLC, how to market yourself or your brand and real estate. And they want their advisor to be a mentor or a coach in this regard.

If they don’t have a business, they want help addressing questions that reflect an entrepreneurial attitude toward their career, like: How important is it to stay in the same organization for a while? How do I make a decision to leave? What are things I should weigh that I am not thinking about? They are looking for a mentor relationship that is not purely based on finance.

They like a holistic approach. Tax services are a differentiator for millennials. They’d rather work with a one-stop shop than buy services from multiple financial firms.

There are some potential challenges ahead of many millennials. For instance, some say they haven’t started investing because they believe they don’t have enough money to invest or are swimming in student loans and want to pay them off before they get started. Some also feel a responsibility to support other family members, which means they will need to amass more wealth.

But they have an advantage that earlier generations did not have: Information. They know it is possible to work smarter, not harder. They have as much information as their advisors do. They fact check what we tell them. And for advisors who are willing to work with millennials the way they like and help them pursue their dreams, there is tremendous opportunity ahead—one robo services can’t address.

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