The financial services industry has been talking about the Great Wealth Transfer (GWT) for the last 10 years.
In that time, my mom and my aunt’s advisors became aware of me, and I know of them. They have not reached out to me once to discuss issues related to legacy, my family’s wishes or to see if I would like to receive their services. As a member of Gen X, I am among the ones getting first crack at the estimated $74 trillion in GWT funds, yet the advisors most familiar with my family aren’t hustling to make sure I become their client. And I know that I’m not the only one – up to 70% of second-generation investors don’t choose to work with their parents’ advisors.
Yet again, Gen X is the forgotten generation because either advisors don’t know or aren’t communicating with the members of this generation. There have been a lot of articles, whitepapers and chatter about how advisors can get more Millennial clients and what practices they prefer. Respectfully, advisors need to focus on Millennials AND Gen X, not one to the detriment of the other.
Gen X is being sorely overlooked. Only 29% of Gen X has completed an estate plan, according to Trust & Will. Gen X’s knowledge of the process of creating a will was the second worst in a recent Trust & Will survey save for Gen Z. Both 58% of Millennials and Baby Boomers were familiar with how to write a will; Gen X was 53% knowledgeable.
My generation is also in the worst debt, as per Experian; the average credit card balance in this generation is more than $9,000. These data points indicate that Gen X is very much in need of financial advice.
Don’t Forget Us
This isn’t a group of individuals that advisors are incapable of getting in front of. Time needs to be made to reach out to this generation, particularly those that advisors already have a connection to. This could be a case of advisors utilizing technology to serve up fresh opportunities for them a la Bento Engine, which tells advisors when to engage with their clients and/or their family members (provided those people made it into the advisor’s client relationship management system).
Or it could mean taking your existing marketing and better tailoring it to Gen X. As both a member of the generation and a marketer, I can tell you that Gen X doesn’t appreciate hard sells and prefers to learn from you. Advisors need to show a Gen X investor what they’re made of, be transparent and build trust with us. Those are the hallmarks to win us over.
What’s On The Line
As the GWT is starting to occur, this is a key time for both Gen X and financial advisors. For Gen X, we need to understand what our parents’ wishes are and do our best to carry them out. We also need to prepare ourselves to receive the wealth that is coming our way, as especially given the debt that some of us are in, a windfall would be a drastic shift.
For advisors, this is a chance to lock in clients who will be gaining a significant portion of wealth and need guidance. And, if they learn how to connect with the children of their Baby Boomer and Silent Generation clients, they can take that process and then tailor it to engage with Millennials, Gen Z and others. Advisors can also pass on that knowledge to the next-generation advisors.
Matt Halloran is co-founder and chief relationship officer at ProudMouth, producers of powerful content marketing.
