Cerulli Associates, an asset management research firm, says nearly 45 million U.S. households will hand over $68.4 trillion to their heirs and charities in the next 25 years. Although Generation X, born 1965 to 1980, will become the wealthiest generation, the sheer preponderance of Millennials, born 1981 to 1996, has elicited spirited commentary about their financial attitudes and behaviors. The U.S. Census Bureau reports that Millennials comprise 83.1 million of the U.S. population – exceeding the 75.4 million baby boomers.
Set back by the global financial crisis of 2007 and 2008, Millennials fear market volatility and distrust financial institutions – contributing to fairly conservative financial decisions despite fairly liberal opinions. According to Capital Group, 85 percent think it’s important to have a long-term financial plan, 58 percent are conservative investors and 56 percent claim to have a financial adviser.
Now Millennials have reached the age where they are making important decisions that will have major impacts on their finances and responsibilities for decades to come – purchasing a home, getting married, having children and so on.
A study by LinkedIn and Greenwich Associates found two out of five Millennials are actively looking for new advisers, which modern technology has made even easier. They are more likely than other generations to seek real-time information and find educational content on finance via social media.
Manish Moorjani, senior director of product management at Publicis Sapient, said it’s important for wealth management advisers to help the transfer in ways that address the needs and concerns of the younger generations. Far more than developing a new phone app, advisers need to embrace a holistic approach.