Tag Archives: gen y

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3 Reasons Financial Advisors Should Court Younger Clients

Originally published CNBCLast month I attended a presentation that explored, in depth, the notable differences and financial tendencies of several generations, from the silent generation through the millennials.

The presentation described certain representative traits perceived as common among each generation and what financial advisors should consider when communicating with members of them as prospects and clients.

When discussion of the younger generations came up, I noticed advisors around the room rolling their eyes and scratching their heads. The expert at the front of the room was providing well-researched data to help us understand what is important—and less so—to these generations and how we might consider breaking through to them. 

But, as the attention of this group of well-heeled advisors descended into a collective yawn, the presenter scurried to wrap up before answering the most important questions:

  • Why exactly should financial advisors dedicate themselves to working with younger clients?
  • Why should advisors apply valuable time and money to crafting services and messaging for a demographic niche notorious for inspiring descriptors such as “entitled,” “ungrateful” and “distrustful”?
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Pogo Stick Retirement Planning for Younger Generations

Originally in ForbesHistorically, retirement planning has been likened to a three-legged stool — consisting of a corporate pension, Social Security and personal savings. Baby boomers saw the pension fade from existence, leaving them to balance on retirement planning stilts. For younger generations, however, the retirement situation can seem even worse. Sometimes, it feels like it’s all on us. We’re left with only a retirement planning pogo stick.

Further complicating matters, doctors suggest that the length of life Generations X, Y and Millennials can expect may exceed that of our parents and grandparents. We’re likely to live a long time, but our quality of life — to the degree that it is improved by cash flow — is in question because of the heightened savings burden.

Last week, I shared two “silver bullets” — MOVE and WORK— for hopeful boomer retirees who may fear that a 14-year stretch of economic uncertainty has put their goal for a comfortable retirement out of reach. Here’s how these two concepts can be applied to younger generations:

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Real Estate Quagmire Sinks Gen X, Y Fiscal Hopes

Originally published CNBC

Throughout the course of my career, I’ve heard a lot of financial horror stories. The majority of these stories are told by baby boomers whose aggressive stock market strategies went bust, often at the behest of a transaction-oriented “advisor.”

The most pain—yes, even marginally greater than that of former Enron employees and Bernie Madoff scam victims—has been felt by a younger generation, however, in America’s suburbs, far from Wall Street.

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Pogo Stick Retirement Planning (for Younger Generations)

Pogo stick
While most of my career has been spent advising the Depression Baby and Baby Boomer generations, I have a real heart for younger generations… which, for those of you who know me personally, should come as no surprise.  After all, I’m a Gen-Xer myself.  I’m married (ten years this April) with two energetic boys, ages 5 and almost 7, so I’m right in the thick of it with many of my peers who have built their careers and financial lives in a decade that has delivered the highest level of stock market and real estate volatility since the Great Depression.  And while the complexity in planning for 30- and 40-somethings is often not as great as those who’ve traveled further down life’s winding path, there is no denying that our planning needs range the broadest spectrum imaginable in personal finance.

Some of these topics, such as retirement, appear almost beyond the grasp of younger generations because the variables are so many and the timeline so long.  Indeed, for those closer to the front-end of our retirement journey, we’re faced with a daunting task indeed.  The retirement planning “three-legged stool”—once consisting of a corporate pension, a Social Security retirement benefit and personal savings (savings, 401ks & IRAs) is now the retirement pogo stick!  It’s on us—you and me—to fund our own retirements.  Further complicating matters, doctors suggest that the quantity of life for Gen X and Yer's may far exceed that of our parents and grandparents.  We’re likely to live a long time, but the quality of life—to the degree that it is improved by cash flow—is in question because of the burden of saving.

Last week, I focused on two retirement planning “silver bullets” for hopeful Boomer retirees (Part I & Part II) who may fear that a decade of economic uncertainty has put their goal for a comfortable retirement out of reach.  Here’s how the two concepts I shared are applied to younger generations:

MOVE: The disparity in cost of living across our great country is so vast that it’s almost unfathomable.  I encouraged those on the home stretch of retirement that one could take a failing financial scenario in Parkton, MD—a typical northeast suburban environment—and transplant it in Knoxville, TN, where the same exact home equity and retirement savings would allow them to live happily ever after… financially speaking.  The advantage YOU have is that you can make a decision NOW to take advantage of this geographic arbitrage in advance.  You can CHOOSE to live in a higher cost-of-living area now while keeping an eye on another area to which you might like to transition later in life to give your plan for financial independence a turbo boost.  (Check out the cost-of-living in your area and dream about others with this tool: www.bestplaces.net.) 

WORK: The second silver bullet for near retirees is to transition from a higher-paying job that feels like a grind to a job that they love for less pay, fully recognizing that both medically and financially speaking, we’re really all better off working indefinitely.  The bad news for Baby Boomersis that many grew up with a more utopian view of retirement… that they’d work for “X” number of years and then cast off the chains of employment to spend their latter years in the lap of leisure, if not luxury.  We, however, should simply never buy this lie propagated by the behemoth financial industry, preferring to dangle the carrot of unencumbered bliss on our horizon so that we’d stay on the hamster wheel of hording in the accounts they manage for fees and commissions.  We should EXPECT that we’ll be working indefinitely, and, facing that reality, we should work tirelessly to seek and find that career that doesn’t feel like work.  We can be financially independent as early as our 30s, not because we’ve saved a few million bucks by then (although that wouldn’t hurt), but because we’re working because we WANT to, not because we HAVE to.

What younger generations have lost is the hope that we’ll be able to rely on someone or something else to take care of us financially in our later phases of life.  What we have gained is the freedom and flexibility to pursue a life that is uniquely ours.  Enjoy every minute of it!