Thomas Forbes thinks the robo-advisor is an interesting evolution for the insurance and financial planning industry. Forbes, associate financial representative for Northwestern Mutual in Los Angeles, sees the rise of the robo-advisor as both a challenge and an opportunity. “It makes sense to where we are today in the world. I think it will slowly begin to penetrate the millennial market because it’s easy and it’s low cost.”
Forbes sees the benefit for young people who don’t necessarily make time to meet with financial advisors to create a financial plan, including insurance and retirement. “It’s not always easy to set aside time for something like financial planning if you don’t know you have a need for it. It’s not how millennials roll.”
He should know — Forbes is a millennial, as well. Plus, he’s new to the job, having been a financial rep for just two and a half years. It wasn’t a job he intended, but after college and two years in South Korea teaching English and learning a foreign language, he was home and considering his options.
He was also considering going back to graduate school for pre-med or physical therapy. Yet he felt he was on the wrong course. It was then he called his financial advisor, who worked at Northwestern Mutual, and talked with him about making a Roth IRA contribution. “After that conversation, he asked me what I was doing for work, and if I’d be interested in working for Northwestern Mutual. He referred me into the business.”
The network challenge
It wasn’t an easy transition. His first challenge was the toughest — networking. Having been away at college for four years, then out of the country for two more, Forbes struggled to get those first clients. “Your market is what you build on from relationships. I didn’t have as much focus off the existing relationships in Los Angeles. So coming back in, the challenge was rebuilding the network.”
He was able to do that successfully within the LGBT community, of which he is a member. While that sets him apart from other agents and gives him opportunity, he says it’s still challenging finding the right methods by which to capture that demographic. The majority of LGBT clients have come to him through referrals.
However, it’s also a market segment with its own unique needs. HIV, for example, while not prevalent within the community, remains a concern for a small segment of the population. Forbes says that it’s mostly an uninsurable event, but he’s seen some companies working toward getting a product on the market. However, that coverage remains expensive.
Within the LGBT segment, Forbes says retirement planning is actually quite a good opportunity for his clients. “A lot of gay couples or singles don’t have children. That’s a cost they don’t need to plan for in terms of education planning or general retirement planning. They don’t need to set aside so much capital to give to their kids. That gives them a big opportunity to save more than the average person who’s got two kids.” Yet even that is changing. He’s seen a growing number of the LGBT community in Los Angeles opting for children.