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November 11, 2014 at 09:10 AM
It’s no secret that financial advisors under 30 bring a lot to the table when it comes to wealth management. Everything from their tech-savvy solutions to their ability to connect on a very different level with younger investors make them valuable assets.
But in what specific areas should they use these skills, and where should they focus their attention to speak to what the next generation of investors is looking for? We asked a panel of young, rising star advisors at a recent conference, and here were their insights:
1. Socially Responsible Investing: Investors of all ages are becoming more conscious of the impact they are making socially as well as financially. Investors want to make sure that their investments reflect their values as members of society and as business owners, rather than just the realization of their financial goals. This is becoming such a central objective that even wirehouse firms are beginning to incorporate it into their infrastructures. Advisors who are not in a position to help investors leverage this capability through screening their investments for negative environmental, social or cultural affiliations could be alienating a key segment of investors. Even more proactive practices beyond screening, which include impact investing, shareholder advocacy and community investing should be on advisors’ minds as well.
2. Outcomes & Goals-Based Investing: As advisors move more and more toward a financial planning focus for their clients, more potential and current investors are going to expect this type of care, which gives greater attention to goals-based investing. Investors are increasingly concerned with ensuring their families’ financial security, and less concerned with outperforming the market or achieving higher returns on their investments. The financial planning approach is exceedingly becoming a source of comfort for investors, especially considering the recent volatility of the market.
3. Succession Planning: As aging advisors retire from firms en masse, leaving large amounts of assets behind, the need to focus on succession planning is even more important. Younger advisors are expected to fill the roles of advisors with 30-plus years of experience by catering to the needs of their clients in a fashion that is reminiscent of what they’ve experienced in the past, while fulfilling the needs of a very different future. This requires that the older generation of advisors bring their younger partners into the fold of their vision even earlier on. Learn more about the importance of thinking about succession planning today in our blog: “The Biggest Oversight Financial Advisors are Making for their Futures.”
