This post was authored by Haley Spanier, Dunham's Marketing Communications Associate. If you have questions concerning today's topic, please call us at (858) 964 - 0500. Hold us to higher standards.

An article titled “Why Not to Hire Your Parents’ Financial Advisor” explains that the financial goals of Gen X and Gen Y investors don’t always align with their parents’ goals. This could be due to their student loans, saving to buy a home, or other economic factors that their parents may not have faced. Not to mention, the even younger generation, Gen Z, is now entering the workforce and participating in investment opportunities as well.

The aforementioned article advises younger investors to shop around for a financial advisor rather than simply working with the advisor their parents use. In fact, 66% of children fire their parent’s financial advisor after they receive their inheritance (1).

If you haven’t yet established yourself as a trusted resource for young investors, specifically the children or grandchildren of your clients, you could be missing an opportunity to work with a key demographic. Over the next 30 years, $30 trillion will be passed down from Baby Boomers to Generation X to Millennials. Additionally, according to The Motley Fool, “73% of Gen Z investors, 66% of millennial investors, and 67% of investors aged 18 to 40 overall own stocks.”

Although the number of young investors is growing, Investopedia reported that “advisors don’t often talk about how clients can have money conversations with their kids. Only 35% of advisors say they actively bring up the issue.” Parents may leave their children with assets and inheritance, but may not have advised them on how to manage those resources.

How will building client relationships with your client's children and grandchildren help you? What can you do to connect with them and assure them you are the right person to help them reach their financial goals? Read on to discover how you can use your experience to ensure young investors have the tools they need to be financially successful.

building client relationships

How Can Financial Advisors Strengthen Relationships with Existing Clients and Their Families?

Begin the Conversations Early On

Ideally, you can begin communicating with your client’s children and grandchildren while still working directly with their parents. Creating these connections early on can build a lasting relationship with these young investors. Ask parents if and how they would like to involve their children in important planning decisions.

Check in on your clients regularly. Creating that personal relationship with your clients will reflect positively with their heirs. This is an excellent opportunity to establish a relationship directly with your client's children, especially if one didn't exist yet.

You can even initiate a conversation with these prospects one-on-one to learn more about their family relationships, investment goals, assets, and any potential relationships with other financial advisors. It is important to develop a personal relationship, learning more about their priorities and day-to-day life so they feel comfortable using you as their financial advisor.

Some potential questions you can ask to begin these conversations are:

  • What are your personal and professional goals?
  • Which family relationships (spouse, children, siblings, etc.) are most important to you?
  • How do you make money? Is that likely to change in the next three years?
  • What is the best way to get in touch with you, and how often do you prefer to be contacted?

Develop Tools and Resources Targeted towards Younger Investors

After you have initiated the conversation and established yourself as a trusted authority, you can continue building on the client relationship by providing tools and resources geared specifically to investors of their age group. Consider how investors of their generation may have similar financial aspirations, personal and professional goals, and social and ethical principles.

Some resources and tools you can offer to your clients' kids and grandkids include one-on-one financial advice about college and student loans, resume counseling, offering to be their 401(k) coach when they get their first job, and consulting as they prepare to purchase their first home. You could also create a guide that explains the basics of investing for beginners.

  • For a birthday or special occasion, send a financial book to the child or grandchild.
  • Guide them through the process of making their first investment.
  • Explain to them what it means to be a trustee of their parents.

Make Sure You Have an Online Presence

Many young investors have turned to social media for financial planning advice. One study shows that 41% of Gen-Z investors turn to social media to educate themselves on investing. Additionally, more than 50% of Gen-Z investors surveyed made a trade in the first three months of 2021 during the meme stock craze. You can position yourself as an expert, which will be especially helpful for young investors navigating the volatility of meme stocks and turning to social media for advice.

Having a social media presence may be essential for connecting with young investors entering the world of finance. Most of Generation Y and Z prefer to communicate via email, instant message, or text, so opening yourself to these platforms may facilitate conversations. Some avenues you can utilize are LinkedIn, Facebook, or Instagram. (If you want to make sure your LinkedIn and Website are up-to-date, check out this post.)

  • Create original content for your website and social media platforms.
  • Share helpful articles and videos with your clients via LinkedIn, email, or text.
  • Offer virtual and in-person meetings to make yourself available to clients.

Building Professional Relationships with the Next Generation

As you continue managing parents' finances, keep in mind how you would like to continue managing those assets after they are passed to the next generation. Establishing yourself as a trusted source for young investors may make children less likely to seek out a new advisor as they begin growing their own assets.

Build Client Relationships with Dunham’s Across Generations Marketing Campaign Today

Dunham’s Across Generations Marketing Campaign is designed to help financial advisors effectively expand their business across generations by converting spouses, significant others, children, and grandchildren to clients. This free to use campaign offers tools that can be immediately implemented to help you better understand your clients and their families, begin legacy discussions, and build a strategy that is right for you to help master your generational reach. Contact us at (858) 964-0500 to learn more today!


(1) Dunham & Associates Investment Counsel, Inc.

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