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My dad had a financial advisor for 25 years, but it wasn’t until about 6 months before my dad died from cancer that his advisor tried to make contact with me. He’d had the beneficiary contact info for decades, but didn’t reach out until my dad’s fate was sealed. As soon as the inheritance was handed down, I transferred the money to another advisor. What I didn’t realize at the time was just how common my story was.
We’re in the early phases of a wave of money in motion dubbed the “wealth tsunami” or the “great wealth transfer”. A staggering $72.6 trillion will be passed down to heirs by 2045. While it’s hard to wrap your head around a 4-comma figure, it’s essential to wrap your head around what it means for your business.
An Exodus of Heirs
An estimated 80% or more of heirs will look for a new advisor when they inherit their family’s wealth. Why do they leave? According to research, the heirs move the money to work with a financial advisor who “gets” them. Even if you’ve built a close relationship with your client, you might not understand what’s keeping their kids and grandkids up at night. And it’s not the same as their parents, which is why using the same communication approach won’t work.
Interested in keeping the heirs on your client roster instead of losing them at the funeral home? Here are 3 ways you can take action and stay afloat in the wealth tsunami.
Tip 1: Understand
To connect beyond the Boomers, you first have to figure out who they are and what they want. Get to know the generations so you can understand what makes them tick.
Generation X (born 1965-1980)
Often referred to as the “sandwich generation,” Gen Xers are caring for their aging parents and supporting their own children. They want advisors who will help them navigate their unique challenges.
Millennials (born 1981-1996)
They are poised to inherit a big chunk of the wealth transfer in the later stages of the wealth tsunami. Millennials prioritize socially responsible investing, digital financial tools, and transparent fee structures.
Generation Z (born 1997-2012)
Gen Z will be the last to be swept up in the wealth tsunami. For advisors, connecting with them early and giving them long-term, relevant guidance, will be the key to lasting relationships.
Tip 2: Audit
Give yourself a critical digital once-over. Is your website loaded with sailboats and silver-haired couples on the beach? This shouts, “I only care about the Boomers!” Take an objective look at your branding, starting with your website. This starts by getting clear about who you are trying to attract. If you’re going after the younger investor, take some time and refresh your images and address the pain points that apply to your target audience.
Don’t know what appeals to younger demographics?
This is where your team comes in handy. Get the next gen on staff involved. Don’t have the team? Assemble a focus group outside of the office of Gen Xers, Millennials, and Gen Zs to give you some feedback as you go through the audit. Don’t forget to make sure your website is mobile friendly. Younger investors will definitely Google you as a natural part of their research process – even if you’re already working with their parents or grandparents. And it’s likely they’ll be searching for you from their phones.
This isn’t a one-and-done audit. Schedule an annual review (you’re familiar with this concept!) of your target audience and whether that audience is clearly conveyed through your digital brand.
Tip 3: Create
Did you know that 82.5% of all online traffic in 2023 is video (Cisco)? That’s 15 times more than in 2017! In fact, video content is the fastest growing channel, and your audience is quickly converting from consuming text to gobbling up video. If you don’t have a video strategy yet, it’s time to get one.
Consider that Millennials were born into a digital world and have never had to wait for anything. They are not going to wait for your next meeting to get the information they want when they can find it online in seconds – probably on YouTube.
If you don’t have a YouTube channel yet, it’s time to get one. Then get busy creating your own video library. When the kids and grandkids of your clients go searching, make it easy to find out more about you. And when your content speaks to their needs, you’ve begun to build a bond.
Social media channels, email marketing, and website updates are all keys to connecting with the Next Gen of investors. But you don’t have to do it all! It’s far better to pick 1-2 channels to focus on than to try to cover every social platform. Try to do it all and you’ll end up with mediocre results at best.
Remember, just because you have a close relationship with your clients, doesn’t mean it transcends the generations. It’s time to prepare for the wealth tsunami of the next two decades, because there’s a massive opportunity for advisors in the coming years.
Oh, and there’s an added benefit for you when you try to connect with Next Gen investors. You’ll get better at connecting with clients and prospects of any generation.
Related: Digital Campaigns That Work: How To Get More Qualified Leads