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Financial advisors with any ambitions of growing their practices in the next couple of decades can’t ignore the emergence of Gen Z as an economic force. Though the estimated $143 billion in assets held by Gen Z is dwarfed by the trillions held by millennials, Gen Z workers are expected to outearn millennials as soon as 2030. They will be more educated and more ambitious than their generational predecessors, and they will be starving for financial advice.
The challenge for financial advisors is that while even today, the members of Gen Z are looking for financial advice, most prefer to find it through social media, the internet, and their parents or friends, according to the FINRA Investor Education Foundation.
The good news for advisors is that the same study found that 71% of Gen Z investors are receptive to working with financial professionals, counting them among the most trustworthy sources of financial information, second only to their parents.
The critical issue for any financial advisor hoping to attract young clients is whether they are perceived as someone who can be trusted to serve them in the manner they expect.
What do Gen Z clients want?
Attracting Gen Z and young millennials in their 20s requires an entirely different mindset and approach tailored to their unique financial needs, preferences, and behaviors. Advisors must consider integrating the following elements into their practices to appeal to younger clients.
#1. Expand your digital presence
Anyone who has studied the behavior of young adults has concluded that if advisors don’t have an effective digital presence and can’t demonstrate an ability or desire to communicate with them through social media and other forms of digital interaction, they risk irrelevance. That includes having a dynamic, high-quality website, appealing social media profiles, and a blog or vlog to share compelling content and insights.
#2. Produce compelling and relevant content
Speaking of content, it’s one of the primary reasons young adults go online. But not just any content—it must be valuable, insightful, and relevant to the issues that concern them. More than half said they put faith in information that is “relevant to me.” It’s also essential to be mindful of the way young adults prefer to consume their content—visually through infographics, podcasts, and streaming platforms such as YouTube, Instagram, TikTok, and LinkedIn.
#3. Emphasize education
More than half of young adults say they don’t invest because they don’t know enough to feel confident. Advisors must be patient and willing to educate them one-on-one, using clear, jargon-free language. Advisors can demonstrate their willingness to educate clients by conducting workshops and webinars on financial topics relevant to young adults. These events can attract potential clients and establish your bona fides as an expert.
#4. Offer robo-advisory services
An increasing number of advisors are integrating robo-advisory services into their practices for a hybrid approach to financial advice. Young adults are drawn to fintech and are big users of robo-advisors, but many also want access to human advice. Integrating fintech tools and apps into your services can make them more interactive and convenient. The younger generations are anchored in technologically driven mores that must be understood and fully embraced by anyone who hopes to gain their favor and, in the case of financial advisors, their trust.
#5. Offer personalized services
A prevalent trend across all age groups, but especially for young people, is personalization, making them feel as though they are not just an account number. You must be able to demonstrate how your services are tailored to their specific needs and preferences. Always emphasize how your services and solutions can help them achieve their financial goals.
#6. Make your presence known
In addition to creating a visible online presence, advisors can increase their visibility among young adults by engaging them where they congregate. You can meet your professionals and recent graduates by attending networking events and conferences, preferably as a speaker. You can also collaborate with professionals or organizations that cater to young adults, such as career coaches and college alums associations. Offer joint workshops or promotions to tap into their existing client base.
#7. Give back to your community
Younger adults are especially drawn to businesses that actively contribute to their community. They want to see that it’s not all about money to you and that you care about the well-being of others. Participating in community events or volunteer activities also gives you the chance to connect with young adults.
Gen Z and young millennials are beginning to flex their financial muscle, and financial advisors who want their fair share of this burgeoning market must quickly adapt and stay on top of the trends leading the change. Developing a reputation for expertise, trustworthiness, and genuine interest in helping young adults achieve their financial goals will be vital to attracting and retaining clients in their 20s.
Related: Top 5 Critical Acquired Skills Financial Advisors Need for Success