Reignite Growth: Millennials Can Help Future-Proof Your Practice

Of the many quotes attributed to Winston Churchill, there’s a lesser-known one about comparing a military offensive to tossing water on the floor. He said, “every offensive lost its force as it proceeded. It was like throwing a bucket of water over the floor. It first rushed forward, then soaked forward, and finally stopped altogether until another bucket could be brought.”

Many veteran financial advisors find themselves relating to the end of Churchill’s quote. Their growth is “soaking forward,” carried forth by a small stream of referrals. A 2020 study by McKinsey showed that market performance contributed roughly 75% of asset growth for advisors. This asset growth averaged 7.9% annually between 2015 to 2020, but when you take out market performance, asset growth trickles down to a meagre 2.0%.¹

The study attributed this drip-drip-drip of growth to two factors. The first was inertia on the part of the advisor – they’ve built a successful business and have strong relationships with their clients. For the most part they are satisfied with where they’re at, which dissuades them from investing significant time in aggressively growing their business. The second factor was changing demographics; namely, the advisor’s clients are getting older. Keep in mind that an aging client base is a stagnating, indeed depreciating, asset base.

Consider that the average age of advisors’ clients is 64.2 years old, and death was the top reason why advisors lost a client. Additionally, 80% of widows in Canada leave their advisor within a year of their husband’s passing.²

So, with these statistics in hand, perhaps now is an opportune time to bring forth another bucket of water to spur growth in your practice.

Specifically, we’re referring to attracting Millennial clients because, as shown in a recent Maclean’s article, Millennials in Canada will inherit nearly one trillion dollars between today and 2026.³

Millennials are now all grown up: the youngest of their generation is 28 years old while the oldest is 44. If they aren’t already in their prime-earning years, they’ll arrive there soon.

Let’s examine three key characteristics that define this generation and consider an easy-to-implement solution to satisfy each characteristic.

1. Millennials love and expect personalization – If you’re like many millennials, you use Spotify to stream all your music. If you use Spotify enough, it’s algorithm will create “Daily Mixes” for each genre of music you listen to regularly. So, every day you get a new playlist loaded with your favourite music, made uniquely for you.
   
   
   1. Solution – You can easily implement this idea of personalization across the entire relationship with your Millennial clients. During the discovery, ask questions to better understand their unique challenges and personal goals, then design a financial plan tailored to meet their goals using solutions allocated specifically for them. As your Millennial clients continue to work, start a business or receive an inheritance, their financial plan can be modified to suit whatever comes their way in life. Lastly, be sure to leave time in all your meeting agendas with Millennial clients to let them ask questions and express their opinion regarding your recommendations, so they feel heard and respected.
       
2. Millennials seek authenticity and want to work with individuals aligned to their values⁴ – In late 2018, Nike released its newest ad campaign to celebrate the 30-year anniversary of its “Just do it” slogan. The “Dream Crazy” campaign featured a close-up of former football star Colin Kaepernick with the words, “Believe in something. Even if it means sacrificing everything. Just do it.” The campaign struck a powerful chord with Nike’s target market: Millennials. The ad was controversial, but despite that, Nike’s income jumped 10% that quarter.⁵ Seeing this ad inspired you to get up and get after it, whatever “it” represented to you, so long as your actions made the world a better place, in a sense.
   
   
   1. Solution – Create a business philosophy and share it widely. Your business philosophy (like Nike’s “Just do it”) is an excellent way to share your values, what you believe in as a financial advisor, and for whom you do your best work. This business philosophy can form the bedrock of your marketing and client-facing communications. See our blog post entitled, “From Values to Action: How Financial Advisors Can Develop a Business Philosophy” to learn how to craft your own business philosophy that’ll resonate with your target audience.
       
3. Millennials want clarity – Today, having the fee conversation with clients is usually table stakes. But with Millennials, they want to know about fees and costs upfront. In other words, posted on your website in full detail.
   
   
   1. Solution – A recent study showed that nearly 60% of Millennials reported that seeing upfront information about fees, among other things, positively influenced the trust they had in the institution.⁶ This transparency also applied to activities like digitally tracking account opening status (74% saying it was very important) and a clear onboarding process (72% saying it was very important).⁷ So, create a section on your website, perhaps including blog articles, detailing your fees and what value and services your client will receive for that fee. The savviest advisors have videos on their website describing the client onboarding process in minute detail. The clearer and more transparent your fees and process, the better you’ll do establishing genuine trust with Millennials.

The biggest wealth transfer in history is already underway, and Millennials are set to be the primary beneficiaries. Your ability to tap into this lucrative market depends on how you respond today and the foundation you build to keep Millennials satisfied, loyal and working with you well into the future.

By personalizing your offer to each Millennial client and aligning with their values authentically, while also being clear about your value proposition and service offering, you can more deeply connect with your Millennial clients and prospects.

Don’t let your business growth fade—bring that next bucket of water to ensure your practice thrives for years to come.

If you’d like to learn more about this topic and related solutions, please reach out to your CI sales team.

Sources:

1. Bol K., Kennedy P., Lee R., Vervoort J., “The value of personal advice: Wealth management through the pandemic,” www.mckinsey.com, May 25, 2021
2. McCabe C., “Diversifying Your Client Age Base,” www.truelytics.com, June 28, 2021
3. Onstad K., “The Jackpot Generation,” www.macleans.ca, September 12, 2024
4. Shaw J., “The Millennial Metamorphosis: What Matters to Them in 2024,” www.kadence.com, May 2024
5. Soo Y., “Nike sales booming after Colin Kaepernick ad, invalidating critics,” www.abcnews.com, December 21^st, 2018
6. “Inside the Lifecycle of the Financial Services Consumer,” www.data-axle.com
7. Lee M., Bellens J., Batra, G., Babcic S., Wightman M., Toepfer O., Nott V., Palmieri U., “2023 EY Global Wealth Management Research Report,” www.ey.com, March 25, 2024