Wall Street Banks Take on Summer School: Investing 101 for Rich KidsWall Street Banks Take on Summer School: Investing 101 for Rich Kids
Every summer, some of Wall Street's biggest wealth management firms organize events catering to future heirs of their ultra-wealthy clients.
July 6, 2017
By Elizabeth Dilts
NEW YORK, July 3 (Reuters) - "Time for a prenup?" is not atypical title for a summer school course, but it was one of themost popular at an event Morgan Stanley held last weekfor the millennial-generation children of its richest clients.
Every summer, some of Wall Street's biggest wealthmanagement firms organize events catering to future heirs oftheir ultra-wealthy clients, hoping they can teach them a thingor two about money, and plant the seeds for what banks hope willbe fruitful business relationships down the line.
Wealth managers see a big opportunity in the millennialgeneration, those born between 1980 and 2000, who are expectedto inherit an estimated $30 trillion from their Baby Boomerparents over the next 30 years, on top of their own earnings.
The millennials already control nearly $17 trillion, or 10percent, of the world's wealth, and that figure is expected torise to $35.3 trillion, or 16 percent, by 2020, according to theBoston Consulting Group (BCG).
But capturing millennials' attention has been difficult forwealth managers like Morgan Stanley, Bank of America Corp, Citigroup Inc and UBS Group AG, becauseof cultural differences between generations and competition fromdigital startups called roboadvisers. Of the assets undermanagement at private banks, only about 6 percent belong tomillennials, according to BCG.
Conferences like the one held by Morgan Stanley are anattempt to get young adults to warm up to Wall Street wealthmanagers.
Held a block away from the bank's midtown Manhattanheadquarters, there were about 50 guests, aged 18 to 35, whoseparents are Private Wealth Management clients. That businesscaters to those who invest at least $20 million with the bank.In addition to "Time for a prenup?", other popular panelsincluded "Show Me the Money! Investing 101" and "CommunicateLike a Leader."
Citi's private bank has been holding similar events on threecontinents this year, including one in Silicon Valley lastmonth. It was for clients' children who have been identified asthe successors to family businesses, and it focused on how touse major innovations in technology, like artificialintelligence, to grow the bottom line.
"If anyone thinks that just by organizing a boot camp thatyou can earn (clients' kids) trust, you're fooling yourself,"said Money Kanagasabapathy, who goes by the name Money K and isthe global head of next generation programs for Citi PrivateBank. "You have to really inspire them and hope that they atleast continue having the conversation with you."
Darya Pishevar, whose father, Shervin Pishevar, is a SiliconValley venture capitalist, attended the Morgan Stanley eventlast week. Though she is still in high school, Pishevar said shewas interested in the sessions on leadership and impactinvesting because her family may create a foundation.
Across the room, 28-year-old medical researcher EmiliaJavorsky said she wanted advice on launching a medical devicebusiness. While she was not sure she would use Morgan Stanley inher business dealings, she said the conference made her feelgood about the bank.
"It made them feel more accessible," Javorsky said. "Whenyou don't come from a financial services background, it can bedaunting. This made it less daunting."(Reporting by Elizabeth Dilts; Editing by Lauren Tara LaCapraand Leslie Adler)
