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Asset Preservation Advisors


State: GA

APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

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Blog-Will High Net Worth Millennials change the world of Financial Advisors?

High Net Worth Millennials have different expectations of advisors than older generations. How will this change the world of financials advisors? Find out ......

| BY Catherine McBreen


Will High Net Worth Millennials change how financial advisors work with clients?  The answer is “yes” and “maybe not”.

As I walked through the Starbucks parking lot with my teenage daughter this morning admonishing her to put the phone down and watch for cars, I realized that the manner in which she seeks information and develops relationships is totally different than people in my generation.  We are all somewhat formal and private.  Most of us would never take a picture of our Starbucks drink and post it with a “Yum, Yum” on Instagram so that all of our friends could see.  Nor would we be blogging our “friends”….from Canada to NY to LA before getting to work in the morning.  But because of summer camp, she has friends she keeps in touch with daily all over the country.  If I wished to contact a friend from summer camp…who was located probably 100 miles away…I would have to write a letter and send it through the mail.  Younger generations, however, are comfortable making sound bites of contact and keeping relationships alive with ongoing short communications.

When my college aged son asks about a particular company and his father and I mumble about how that is probably a good investment….he immediately picks up a smart phone and tells us the closing share price and other key factors.  I would have spent an hour or so reviewing various online sources while seated in my comfortable leather desk chair.  He feels no stress in looking up answers for his online final via Google, rather than paging through the notes from class or reviewing highlighted portions of his book.  He is trusting of online resources and savvy about how to find information. (His grades, however, indicate this practice is both good and bad.)

That’s why a recent survey we completed at Spectrem Group comparing Millennial investors to older generations was not surprising.  At the same time, the results weren’t as different as we might have expected.  About 25 percent of Millennials with more than $1 million of net worth don’t use any type of financial advisor.  But 18 percent of Millionaires in the World War II generation don’t use advisors either.

Let’s focus first on what is different.  Communication and responsiveness are critical.  While individuals in the older generations are most likely to fire a financial advisor because of non-responsiveness, their expectations for responses are generally within the same day (except for doctors who expect immediate responses.)  Because millennials have grown up in an environment of immediate answers, their expectations mirror that experience.  Why can't an advisor just text back the answer?   

Millennials also expect advisors to use social media channels and develop a personality through their social mediums.  While older individuals work on developing relationships through quarterly face-to-face meetings, why not correspond through social media regarding charity events you might support or interesting things that are happening or both? This applies both personally and professionally.

Millennials are also different because they are confident about their knowledge regarding investments (or anything else)…whether right or wrong.  The ability to whip out a smart phone and immediately have facts available provides a false confidence.  The real expertise is still needed to distill what those facts actually mean.

So that returns to the argument that while Millennials are different…they are really the same.  They may expect faster more fact-filled discussions, but in the end, they are really rather conservative.  In fact, Spectrem’s research shows that Millennials are much more conservative investors than Gen X investors.  In fact, based on their age, they should actually be investing more aggressively.  Maybe graduating from college in the middle of the Great Recession influenced many of them.  Maybe even those who are relatively successful see friends who are struggling to make it.  Or maybe they see their Baby Boomer parents worrying about whether or not they will be able to finance their retirement.

In the end, it will still be about the personal relationship that is developed between the investor and the advisor.  They need someone they can trust to help them make appropriate investment choices, and more than likely, that advisor will be interested in the same causes or social issues they are concerned about.  That advisor will probably also be comfortable responding via Instagram, Vine, or whatever medium continues to become popular.  While those of us who are older wait for the SEC to become comfortable with Facebook…..the millennials will have moved on to a whole new channel. (My teenage daughter insists that Facebook is for "old" people.)

Relationships will remain the foundation of the financial advisor world....even if they are spiced up with videos, blogs and texting.

About the Author

Catherine McBreen

Catherine S. McBreen is President of Millionaire Corner.  McBreen plans and develops content for Millionaire Corner.  Catherine balances editorial content to meet the informational needs of both new and seasoned investors.  She designs special monthly surveys on topical issues affecting the economic environment.

McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law.  She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.

Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences.  She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth.  Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.

McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)

Catherine is the mother of four and is involved in many school and community events.