Advisors: Gen Xers need your help. They just don’t want to ask for it.
Mike Van Wyk, Capital Group’s vice president of Customer Research & Insights, shared new research on the unique generational needs of high net worth Gen X clients at Schwab IMPACT 2018. During his presentation, titled "Millennials to Boomers: Better high net worth planning by generation,” Van Wyk revealed data on Gen X and corresponding actions advisors might consider to serve them best.
Defined by family and work ethic
Laser focused on retirement
Trying to go it alone
Gen X: Trust themselves first
Gen X persona: Do-it-yourselfers who need help but don’t want to ask
Meet a generation that wants to be shown, not told.
Many Gen X investors grew up as “latchkey children” and have been do-it-yourselfers since childhood. Gen X investors are unique because they are largely self-directed and trust themselves more than advisors.
There’s still opportunity for advisors. Gen X investors are highly curious, worried about their financial readiness for retirement and willing to tolerate volatility to find the best way to prepare for retirement. If there’s one guiding force for Generation X, it is family. Gen X is twice as likely as Boomers to allow family considerations to steer financial choices. Help Gen X do their own research and focus on long-term family goals, and you’ll win hard-earned trust with them.
Gen X action plan for advisors: Build trust.
The challenge is trust. Gen Xers are skeptical. Only a quarter of Gen Xers trust financial services and only half trust financial advisors.
Make family first. Look for opportunity in “moments of truth” like college planning, divorce and the sale of a house. These life events are acutely important to Gen Xers because they touch the heart of their family. Helping Gen Xers navigate these events is key to teaching them to value financial advice.
Be ready for an aggressive attitude. Many Gen Xers know they aren’t on track for their financial goals. They often respond with an aggressive investment approach. Half of Gen Xers say they prefer higher-risk investments with the potential of higher reward (+12% vs. Boomers), and they are the least likely generation to say that they are conservative investors.
Show, don’t tell. Their DIY attitude and natural skepticism means that they want to put some of their own effort into understanding and approving decisions. More than half of Gen Xers research investment opportunities themselves, more than other generations.
Senior Wealth Advisor of HoyleCohen
Ty Sumerlin, Senior Wealth Advisor of HoyleCohen, discusses his firm’s experiences working with Gen X clients
More in this series about HNW generations
HNW generations: By the numbers
An at-a-glance look at data that define your clients’ generations
HNW generations: Action plan
Enhance your effectiveness as an advisor by understanding your clients’ generation
More about high net worth:
Capital Group Advisor Generational Attitudes Study, September 2018
Capital Group Investor Generational Attitudes Study, August 2018
Capital Group Wisdom of Experience Survey, December 2017
McKinsey Money in Motion Survey, 2016
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