Millennials have grown up and they’re looking for financial advice, Netwealth’s head of marketing Andrew Braun has said.

Braun categorises this group of Millennials – made up of gen y and gen x-ers – as the “emerging affluent”.

These are individuals between 30 and 45 years old with the highest household income of any other group within the advisable population (30 + years old); what’s more is they generally struggle to find a financial adviser, Braun said.

“They’re struggling to find an adviser they can trust and they don’t think they have the assets to justify [receiving financial advice]… the interesting thing is these people do have the assets and they do have the money, the industry just needs to better demonstrate its value,” Braun said on Thursday during a presentation unpacking a research relating to this client segment.

There are about 1.5 million people who Braun categorises as emerging affluent – most are highly educated, hold senior executive and manager roles, high household incomes and growing investment portfolios.

Based on interviews with a 1000 individuals in this category Braun reckons he’s discovered some ways advisers can make themselves some more attractive to what he believes is this “future client” segment.

“Take on the role of co-creator or high performance financial coach,” Braun said.

“Guide them but let them make their own decisions. Tell them something they don’t already know,” he said.

Half of this so called emerging affluent segment – as distinct from mass affluent, emerging mass affluent and established affluent – are are looking for ideas about diversification, Braun said drawing on the research.

Further, many of them need to get a better handle on their insurance needs, budgeting and debt management, Braun notes.

“They’re looking for ways to improve their stability by saving, managing and recycling debt and protecting their incomes,” he says.

Tech enabled

It will come as no surprise the emerging affluent segment are highly tech enabled and are attracted to premium brands and brands with a higher purpose, Braun noted.

“They’re very confident in using tech, much more confident than the average advisable Australian. They search more, use social media, banking apps on a daily basis, listen to audio book, podcasts, video messaging and are highly engaged with financial news.

“When it comes to their investments they like to check their super and portfolios and have see-through in their investment portfolios online,” he said.

Half of all individuals in the survey group said technology capabilities are in the top reasons for choosing a financial adviser, Braun noted.

“You have to make your client experience digital if you want to access this group,” he said.

Eight in 10 respondents within this group still want their initial meeting face to face but for follow ups they’re happy to move online, Braun said. He added that the majority of mass affluent clients surveyed are happy to pay a yearly fee for the service.

Two-thirds of this group – representing 1.5 million people in the more than 9 million advisable market population over the age of 30 years old – said they want to receive financial advice within the next five years, Braun noted.

Smith is head of content and managing editor of Professional Planner and Investment Magazine.
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