For Young Clients, Planning Meets Personal Life

Much of that centers on an automated savings strategy to avoid worrying and continually trying to figure out “What do I have to do now?” to meet goals, she notes.

But the advisor doesn’t shirk from discussing unpleasant what-ifs, such as layoffs, which are rising again in the U.S.

She broaches the subject: “What if there’s some period of time when you aren’t earning income, how would that look?”

Marketing on social media has helped broaden her reach and book of business across the country. With her “Cash Convos” video shorts teaching the basics of financial planning, the Seattle-based advisor brings her message to a wide audience of younger folks, as well as older generations.

Here are highlights of our interview:

THINKADVISOR: What makes you such a success with younger clients?

JULIE PENWELL: I focus on planning and understanding goals first. Younger generations like the idea of holistic planning for their overall financial picture and how their personal life is incorporated with that.

Having an advisor that can really look at you as a person and understand what’s most important to you is definitely attractive to younger clients.

Being younger myself [27], I’m experiencing life alongside my clients. Shared experiences certainly help.

THINKADVISOR: Let’s focus on your younger clientele. How would you describe them? 

PENWELL: They’re mid-career professionals, typically in their 20s and 30s, just starting their careers and ramping up their income. They have complex income, especially equity compensation. They have long careers ahead of them.

I help them reach their goals with strategies to build a financial plan and an investment portfolio that will meet those goals and which includes maintaining an emergency fund.

THINKADVISOR: What are the challenges in getting your advice across to these clients?

PENWELL: One challenge for previous generations was money conversations, and that exists today. Talking about money is still not commonplace.

The way I like to provide value to younger clients is to recognize that we live in a really busy world and have so much on our plates. My peers and I are navigating complicated careers and have decisions to make. So let’s simplify things concerning finances.

The [second part] is how do you make that actionable?

THINKADVISOR: You obviously empathize with your clients, which is extremely helpful. What’s key?

PENWELL: I put myself in their shoes. I know they’re juggling a number of different things. I ask them, “What are the next three steps for what you can do today, tomorrow and [the long term]?

A lot of the conversations we have are about getting clear on what the client’s goals are — short-, medium- and long-term — and then developing a savings strategy to meet those goals.

That’s the high-level strategy approach. The next step is to automate savings: [probably] opening a high-yield savings account for retirement savings and turning on contributions in their 401(k) account.

Automated savings really helps you move forward.

THINKADVISOR: Do these folks have investment portfolios?

PENWELL: A lot of them started saving in their retirement account, so they’re already doing some of that. And maybe they have stock compensation from their employers.

I provide value by thinking about the planning around that and a strategy for it, and help them to set up something they do every quarter, perhaps.

That’s moving forward on your goal. That way, you don’t have to keep coming back and figuring out, “What do I have to do now?”

THINKADVISOR: In what way do you explain the pluses of automating finances?

PENWELL: There’s so much you’re busy with; it’s about how can we automate this portion of your life so you don’t have to think about it, like having groceries delivered once a week.

THINKADVISOR: Are your young clients worried about how the economy, polarization in America and world conflicts could affect their jobs and finances?

PENWELL: We’re talking to a lot of clients about layoffs, how a layoff would impact you in the short term and the long term: What if there’s some period of time when you aren’t earning income, how would that look?

A younger person will be concerned because it’s early in their career, and they might not have savings built up.

That goes back to having a really good understanding of your expenses and your cash flows and having an emergency fund. If a change of income does come into play, what can you do so that you’re well positioned?

THINKADVISOR: Do you get into tax planning and tax strategies?

PENWELL: Yes, especially for those that have high income. Understanding their total taxable picture is really important. A lot of folks don’t really understand their tax picture. I’m able to provide visibility into that.

We partner with tax preparers and CPAs as part of the team.

I help younger clients understand, for example, that it doesn’t make sense for them to utilize a Roth 401(k) or a Roth IRA. So we’re absolutely looking at tax planning.

Younger individuals’ tax picture might change pretty quickly too. I’m helping them understand what it means when you owe taxes and why you want to have strategies around that. It’s very important.

THINKADVISOR: Please explain your “Cash Convos.”

PENWELL: They’re short-form videos of me on social media — to reach a broad audience — focusing on financial planning.

I discuss what a 401(k) is, what life insurance is and why it’s important. It’s making these more accessible. I’m sharing information about cash flow.

Social media is how a lot of younger people receive information these days. I’m a younger advisor with younger clients. So that’s a really helpful tool.