2-minute article

How to engage your clients' next generations

The aging baby boomer generation will be passing down their savings — estimated up to $68 trillion — to their heirs over the next 25 years. Those inheritors are Gen Xers, millennials or, if the wealth is going to grandchildren, Gen Zers.

As a financial professional, you likely already have an idea about which of your clients are planning on enacting their legacy plans over the next few years. Now is the time to start engaging those next generations so you can maintain — and even grow — your business with these families.

Why do inheritors leave?
As many as 90 percent of children inheriting money will not use the same financial professional as their parents. The reasons are varied: they didn’t know them, they were uncomfortable with them or didn’t like them, they were difficult to work with or they were just “out of touch.”

Other research suggests that millennials are more likely to part ways because they don’t have as much trust in financial professionals as older generations did. The firing of a financial professional in many cases may also be about financial education — only 35 percent of inheritors had discussions about their inheritance before they received it.

Start the conversation
In order to gain the trust of your clients’ children or grandchildren and ultimately retain their business, you’ll need to start interacting with them now, when inheritance is still on the horizon. Many of the issues above could be lessened if the heirs had a preexisting relationship with the financial professional prior to a wealth transfer or death of the primary client. Here are a few tactics you can use to get started.

  • Talk about your shared connection. Talking to a client’s next generation about the well-being of the primary client can be a way to share your expertise and establish trust.
  • Embrace technology. While you may have relied in the past on in-person meetings, to reach your clients’ heirs you may need to embrace all things digital where appropriate and applicable. Think virtual meetings.
  • Listen to the younger generation. Avoid one-sided conversations. A major part of retaining any client is listening to their goals. And the younger generation’s goals may be much different than your primary client’s, so listening and helping, even if it doesn’t mean immediate revenue, will help in the long run.
  • Direct products to your new audience. Many millennials are getting married later and less often, holding off on buying homes and changing jobs more frequently. Position products to clearly address their most pressing needs.

Two things you can do today

  1. Review your book of business to identify clients that may be making a wealth transfer in the next five years and contact them to help provide solutions.
  2. When you schedule your quarterly reviews with clients, bring up the topic of financial education for their next generations.  

This information is brought to you by Athene — where innovative annuity solutions are powered by unconventional thinking.