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Advisors Messing Up on Making Millennials Their Clients, Advisors Say

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Many financial advisors are missing out big time by failing to better engage millennial clients, according to new research.

Fifty-six percent of advisors responding to Hartford Funds’ third annual Advisor Anxiety Survey, released Monday, reported that they focused on attracting millennial clients “less than other age groups” or “not at all” even as they identified prospects in that category.

At the same time, 70% said they targeted clients in their late 20s and early- to mid-30s. Nearly two-thirds of advisors who were not targeting millennials at all said they were also pursuing prospects in this age group.

“The term ‘millennial’ has become a buzzword in financial services, being discussed constantly by financial firms and advisors,” Hartford Funds’ strategic markets director Bill McManus said in a statement.

“However, our survey suggests a disconnect when it comes to understanding who falls into this millennial category. In an attempt to filter noise, many advisors might be missing valuable insights for attracting their younger client targets.”

Hartford Funds conducted the in-person survey of 103 financial advisors in June.

Poll respondents’ retirement plans and lack of millennial engagement raised even more concerns, McManus said.

Seventy-one percent of advisors in the survey said they planned to work for at least 15 more years, and 53% planned to work for more than 20 years, yet they were not focused on attracting millennial clients.

More than half of advisors in both groups targeted millennials less than any other age group or not at all.

“Advisors who plan to work for at least two more decades need to thoughtfully engage their younger clients in order to grow along with their needs,” McManus said.

“Millennials will reach critical planning milestones in the coming 10 years and require support in navigating the market and reaching their goals.”

Trending Risk Aversion

Fifty-seven percent of financial advisors polled by Hartford Funds expected risk aversion to rise significantly in the next 12 months, continuing a steady upward trajectory.

This compared with 35% who had this expectation in the 2014 survey, and 17% in the 2013 survey.

“Because advisors foresee greater risk aversion among clients in the coming months, they are in the unique position to help maintain focus on the bigger picture and minimize clients’ tendencies to make emotionally-driven investment decisions,” McManus said.

Fifty-seven percent of advisors reported that market volatility topped the list of issues that keep them up at night, while 51% named interest rates and 46% international turmoil and its effect on markets.

Other issues interrupted their night’s sleep less. Forty-two percent of advisors said they were concerned by clients’ anxiety about saving and investing, and only 32% worried about attracting the next generation of clients.

Just 9% said inflation was a cause of worry.


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