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How to engage your clients' next generations

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Two aging generations, the silent generation and baby boomers, will be passing down their savings, estimated up to $84 trillion through 2045, with $72.6 trillion of it going to their heirs, according to Cerulli’s latest market insight analysis.

Meet the beneficiaries of the “Great Wealth Transfer”

  • Gen X is expected to inherit the largest share of the pie at an estimated $29.6 trillion.
  • Millennials could receive an estimated $27.4 trillion.
  • Gen Z, if any of the assets are passed directly to grandchildren.
  • Charities may also benefit with an estimated $11.9 trillion slated for donation.

What does this mean for you? You’re probably aware of clients who will be ready to transfer their wealth in the next decade. By building a relationship with the next generations, you may be able to maintain these families as clients and grow your business.

Cultivating family bonds to sustain business

Building an age-diverse client base can help you sustain your practice, and an easy first step in acquiring younger clients is involving your clients’ heirs in legacy planning conversations long before any assets change hands. Starting these relationships while your client can make introductions and facilitate initial conversations can help you build a long-term relationship.

6 easy ideas for engaging heirs

  1. Learn about a client’s family
  2. Schedule a family meeting
  3. Review the client’s legacy plan together
  4. Remind clients to name their beneficiaries and make sure they’re up-to-date on all accounts
  5. Encourage beneficiaries to work with a tax or legal expert to help minimize future taxes
  6. Help heirs with inheritance and overall financial planning

Why do inheritors leave?

Some children inheriting money may not stick with their parent’s financial professional if they don’t know the person or don’t understand the value working with a financial professional can offer, for example. Today’s digital investing options could also make some individuals feel they don’t need a financial professional to do what they can do on their own. For these reasons, getting to know an older client’s beneficiaries while their inheritance is on the horizon can be a key part of maintaining that business.

Building strong connections 

After contacting a client’s children or grandchildren, having a meaningful conversation can help you gain their trust. If you aren’t sure how to connect, these conversation starters may help:

  • Talk about your shared connection.
    Opening a conversation with younger generations about their parent’s or grandparent’s (your client’s) well-being can be a way to foster trust and share expertise.
  • Embrace technology.
    While in-person meetings may work best sometimes, embracing all things digital to connect with your client’s heirs could be more effective. These ideas may be a starting point:
    • Meet virtually
    • Connect them to an app or paperless tools for accessing and managing accounts
    • Share bite-sized financial videos 
    • Recommend a good retirement planning podcast
  • Avoid one-sided conversations.
    Part of retaining any client is listening to their goals, and their children’s or grandchildren’s goals may be different than your client’s. Even if it means no immediate revenue, listening and helping them achieve their financial goals may generate good will, transitioning them from tertiary to primary clients later.
  • Listen for competing priorities.
    Many individuals in their 40s and 50s (Gen X) are financially overwhelmed because they’re sandwiched between simultaneously caring for their aging baby boomer parents and children. You can help reassure clients in the Sandwich Generation by helping them prioritize their financial obligations.
  • Direct appropriate solutions to your new audience.
    Many millennials are getting married later and less often, holding off on buying homes and changing jobs more frequently. Positioning appropriate solutions that address their most pressing needs may capture their interest better.
  • Articulate your unique value.
    With the rise of trading apps, younger generations may be comfortable investing on their own. That doesn’t mean there’s no room in their support network for a trusted financial professional. Since some younger beneficiaries may not be old enough to have experienced a market crash, explaining the downside planning you can provide (but that’s missing from an investing app), as well as the other services you offer besides retirement planning, can help show the value in adding you to their financial team.

What’s next?

A survey from The National Association of Personal Financial Advisors sheds light on Gen X and millennial attitudes about their finances. Their survey results indicate 58 percent of working adults across generations have contributed less to their retirement account because of inflation, and many don’t feel sure about their future financial security.

Some of these people could be your client’s heirs. Not only is there a need for you to help transfer wealth to their generation, but there’s a need for retirement planning help. By seizing the opportunity, you could help some of your clients’ beneficiaries gain the retirement confidence they lack.

Helping your clients and your business thrive

Here are two tips that could help strengthen relationships with clients, their families and boost your business for decades to come. 

  1. Review your book of business.
    • Identify clients who could be ready to transfer wealth in the next five years.
    • Understand tax implications and potential solutions.
    • Contact clients to talk about their legacy plan.
  2. Schedule quarterly reviews with clients.
    • Mention financial education for their next generations.
    • Gauge their interest level.
    • Make a plan to meet with their heirs.

Insights on Athene Connect. Tips, tools and resources to grow your business by helping clients retire with confidence.