Should advisors be going after Generation Y–today’s twenty-somethings? A new global study by KPMG says these young folks, who are the next generation of wealth accumulators and inheritors, are being ignored by the fund management industry.
The study, Beyond Baby Boomers: The Rise of Generation Y, found that despite the profound demographic trends–which show that the number of people pushing into the “wealth accumulation” stage of the life cycle (those aged 40-59 years) begins to contract in the United States from 2013 onwards–those in the fund management industry, including advisors, intend to stay focused on serving baby boomers.
Gen Y includes those born in the 15 years from June 1976 to June 1991; they are the children of today’s baby boomers.
Only 28% of fund management businesses, the study reported, say they will develop a relationship with Gen Y as clients over the next five years. This adds to the 22% that have been focusing on Gen Y as clients over the last two years, resulting in “only half of the funds management industry . . . focusing on this key market group.”
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The study was written by Bernard Salt, a partner with KPMG Australia, and included responses from 125 fund management executives from 17 countries, including one-on-one interviews with senior executives from the U.S., UK, and Germany. Focus groups were also conducted with members of Gen Y in London, Frankfurt, Sydney, New York, and Tokyo.