The Money is Moving

Much is written about the current generation of financial advisers approaching retirement and the generation waiting in the wings to step up to fill the advisory gap.

Robert Sofia writes in his article titled Nextgen Is Coming. Are you ready?:

I must acknowledge that Generations X and Y each display distinct traits that advisors should understand and adapt to if they plan to be in business 20 years from now. Here are a few reasons why

  • Generation X and Millennial investors will inherit more than $41 trillion by 2052.
  • Surveys show that 86% of inheritors do not plan to use their parents financial advisors.
  • 29% of wealthy investors are under age 50 and control 37% of investable assets. (Source: Marsten, Cam. The Gen-Savvy Financial Advisor)

Many advisors have built their business models around serving Baby Boomer retirees and pre-retirees ? a strategy that has made sense for a long time, and will likely continue to make sense for a time. Even now, however, the landscape of Boomer wealth is changing rapidly as increasing numbers are reaching retirement age and drawing down their retirement assets.

Furthermore, as Baby Boomers pass away, it is unlikely that their heirs will invest their inheritance with their parents advisors ? unless these advisors provide services that match their expectations.

Bloombergs article titled The Fight Over Financial Literacy notes:

investment personalityMany Americans, burdened by a lack of retirement savings and more than one trillion dollars in student loans, are desperate to know how to make smarter financial decisions. Educators, financial institutions and even some savvy parents have come up with methods to instill good financial behavior. Yet there’s widespread disagreement on the most effective means of teaching kids about money. On one issue most agree: Too many Americans lack the basic knowledge to manage household finances well.

Many Generation X and Y investors have watched the plunging financial markets destroy their parents’ retirement plans; requiring them to continue working well past their longed for retirement age and dont want to be in the same position when they reach retirement. Therefore they may be very risk averse.

What does all this mean for the new generation of financial advisers? Are you prepared to navigate the different behavioral styles and emotions of your generation X and Y clients? Independent research shows that 93.6% of your role is managing client behaviors.

  • Gen X are a well-educated generation with many having qualifications. They tend to be resourceful, self-reliant and often quite skeptical of authority. They will quickly see through an adviser who is product only focused and not prepared to get to know them. But generally speaking they want to build relationships.
  • Gen Y are not noted for being loyal to a particular brand and the speed of the Internet has led this Net savvy Generation to be flexible and ever-changing in many areas of life including where and how they are communicated with. Not all business will be conducted in offices; the new generation of investors are time poor, they conduct their businesses on the run; in hotel lobbies, airport lounges, homes and expect their advisers to be able to do the same.
  • They expect great flexibility from service providers and are likely to change advisers even more frequently if trust cannot be built.
  • The next generation of financial advisers will need to be behaviorally smart. Understanding the importance of engagement with their client peers will be fundamental to ensuring they retain the client.
  • Having the flexibility and skills to communicate with the new generation of clients via social media will be key. But all communication will need to be honest and meaningful to gain their trust.


Carol Pocklington is a Human Behavior Solutions Analyst at DNA Behavior, assisting with the research and development of behavioral products. DNA Behavior helps grow behaviorally smart businesses and financial advisors worldwide to increase competitive advantage using the most reliable behavioral discovery and performance development systems on cutting-edge technology platforms. Solutions are delivered in the areas of client experience management, financial personality management and human capital management.

Visit the Financial DNA website to learn more.

Carol Pocklington

Carol Pocklington - Human Behavior Solutions Analyst

Carol is a member of our research and development team assisting in the development of our behavioral products.
She has worked with Hugh Massie since 2001 since the Financial DNA understanding concept was conceived.


Carol's DNA Natural Behavior Style is - Facilitator


Carol is a Facilitator. Facilitators are persistent, goal-oriented people who promote team effort in order to complete tasks. Facilitators lead by setting examples and by achieving goals. Their strong work ethic encourages others to excel and they have an excellent ability to deal calmly yet firmly with people using a facilitative style.

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