Home Wealth Creation Getting a head start on the Great Wealth Transfer
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Getting a head start on the Great Wealth Transfer

by gbaf mag

By Andy Baillie, RVP Financial Services, Seismic

According to recent estimations, Europe’s next generations are set to inherit around £2.3 trillion from Baby Boomers in the 2020s. Although some will be pledged to charities or siphoned off in taxes, the majority of this vast inheritance will flow straight into the pockets of Gen Xers and Millennials.

This shift is presenting a significant opportunity for wealth managers and financial advisors to build new relationships with these younger generations and capitalise on the biggest wealth transfer in history.

These relationships – and the required trust – can’t be built overnight. If wealth managers and financial advisors want to gain a competitive advantage, they must start speaking millennials’ language and engaging with them in a way that they understand and will respond to.

They will need to present themselves as strong, authentic and trustworthy voices across the media touch points favoured by younger clients, consistently and at scale. This means the winning firms will need to embrace younger clients’ technological and digital-first preferences, while also finding ways to stand out from the crowd. The race to engage the next generation is well and truly on.

Passing the mantle

Clearly, the numbers involved in this financial shift are staggering. But that doesn’t automatically mean financial services (FS) professionals will reap the rewards. The increasing level of competition in the industry is putting wealth managers and financial advisors under pressure to differentiate themselves and secure their place at the table.

For those that do, the opportunity is vast. Passing on the family wealth from one generation to the next doesn’t come without its challenges, and there are several important factors that FS professionals can use to their advantage. For example, it won’t be a fast process. It will likely last several years, presenting a long-term opportunity for wealth managers and financial advisors that are able to position themselves favourably with the future Millennial and Gen-X clients.

Effective wealth transfer is not a straightforward process, especially when a complex portfolio is involved. Similarly, inheriting a handsome sum is one thing, but knowing what to do with it is quite another. This all presents the need for a trusted, expert advisor. Wealth managers and financial advisors therefore have a vital role to play – and a significant business opportunity.

So, how should they build meaningful relationships with the generations of new customers without neglecting the needs of their existing clients? With the Great Wealth Transfer already gathering pace, the onus is on FS professionals to get a head start on the competition and best position themselves for future success before it’s too late.

Getting ahead of the game

First things first, it is imperative that FS professionals find ways to build real trust with Millennials and Gen Xers, who tend to be more sceptical of conventional organizations and very relationship-driven. They have grown up in the experience economy and the digital era where they expect to form closer connections to brands than previous generations regardless of the means of communication.

Building genuine trust with these new generation of customers requires an understanding of their financial preferences, priorities and attitudes – all of which will likely differ from their parents and grandparents. It requires FS professionals to fit their processes into Millennials’ lifestyle. Most importantly, it requires wealth managers and financial advisors to start speaking their language and engaging with Millennials and Gen X in ways that they understand and appreciate.

This is where social media is becoming increasingly prominent. FS professionals can use social media platforms to create and scale their personal brands online and build meaningful, authentic and long-lasting relationships that cut through the corporate noise. With access to the right digital tools and platforms, wealth managers and financial advisors will be empowered to interact with their networks, participate in organic conversations and share timely, relevant content with prospective clients – all in a compliant fashion without introducing undue risks to their firms.

For example, digital tools can automate parts of the communication process with pre-determined content. This enables the fast and efficient creation of personalised decks, presentations and other content that stands out from the crowd, with a centralised workflow that ensures consistency, control and compliance. This can then be supplemented with real-time data analysis to provide insight into how the content is being consumed, in turn guiding future interactions to deliver truly differentiated and engaging customer experiences.

Ultimately, FS professionals must embrace tools that help them effectively manage the digital environment at scale if they want to retain their existing clients and add new ones. Taking a digital-first approach is now essential to long-term success. Those that don’t, risk missing out on the opportunities of the Great Wealth Transfer in the years to come.


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