Estate planning for Generation X and millennial clients is one tangible way to build future loyalty.
Building a bridge: Estate planning for millennials
By John Anderson
Estate planning is a critical part of the wealth management process, and it has always been personal for me. My father (an attorney), died without a will at age 53, leaving my brothers and me to “figure it out.” As a financial services professional, a client, and a parent, I am passionate about the need for formal estate plans for clients of all ages. However, I’m intrigued by the real opportunity for financial advisors to add value, strengthen relationships, and target the next generation of clients. You can see this value presented in Trust & Will’s "2021 Annual Study: Millennial Estate Planning Continues in a Pandemic."
A huge wealth transfer is currently taking place, as baby boomers and the silent generation pass their wealth to Generation X and millennials. Last month, Shauna Mace discussed this trend in an interesting blog article called “Get to know your future clients.” She shared some fascinating insight into the younger generations’ attitudes and desires around advice, investing, and financial planning, but also noted that only a small percentage will stay with their parents’ advisor once the wealth has passed.
From my experience, one of the secrets to building relationships with the next generation of clients is demonstrating valuable and actionable advice early, even while you are still working with their parents. Early studies showed that millennials were more loyal to advisors who offered budgeting advice or information about student loan pay-downs.
According to the Trust & Will study, millennials seek estate planning help after the birth of a child, the death of a family member, or buying a home. Yet many financial advisors miss these opportunities to forge a new relationship. By showing a proactive approach, being involved in the process, and delivering a tangible product (in this case an estate plan), advisors can be well positioned for that next-gen client’s future planning and investment needs.