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Adam Carolan: Four observations on young clients

Adam Carolan: Four observations on young clients

In my dealings with younger clients, I have made a few observations:

1. They want a more tangible service

Younger clients do not buy in to parting with money and see the heels of your financial adviser approach. Based on feedback and some of the great ideas of American adviser and commentator Michael Kitces, I have built a proposition that tells the clients I deal with what they are going to pay and what they are going to get. This is not rocket science but I keep being told by clients and prospects how rare this is in financial services.

If you expect the next generation to pay a fee for a services, you should make sure you define that service and deliver it.

2. They are willing to pay for value

I see lots of surveys about what people are willing to pay for advice. I feel it is almost like asking someone what they would pay for a mobile phone. I would pay nothing for a Nokia today but part with hundreds of pounds for a new Apple iPhone. There are different levels of quality of financial advice and planning therefore I feel this question doesn’t actually achieve anything.

I do think however that a financial planner can add value to those younger clients with complex issues. I have always found success in younger business owners as they really struggle to find the time to organise their finances. I know some NextGen Planners that succeed in serving young professionals and sports athletes.  

This audience pays fees to other professionals such as lawyers and accountants and therefore if you demonstrate that your service is worthwhile and adds value to their lives, why would they not pay for your service? Having a trusted financial adviser is huge value when you are good at driving value in other aspects in your life (i.e. business/career). I have not seen much kick-back from targeting this audience. I do think it is important to make sure your audience has the means to pay but that is surely rule number one when building your proposition.

3. They want different ways to interact

I value my time and energy a lot. Most of my peers do and the idea of a two-hour financial planning meeting taking almost a day out of the working week can make many cringe. This is why at Xentum we have started to evolve our interactions with clients. We often use video conference with clients, go to them to make it easier and we are just in the process of improving the way they can interact with us online. I interact with some of my clients on WhatsApp as this is the medium they trust.  

4. They trust people

My experience with clients around my generation is that they seem to trust word of mouth, professional recommendations and people more than ever. I am sure some would trust online services, but they want a person they can trust to deliver the services and to call up when they want to talk things through. I find this more evident in my younger clients than in the older ones. They also seem to trust financial services more as they have not been subject to the sins of the past. Let’s not ruin that!

Adam Carolan is the director at Xentum and founder of NextGen Planners.

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