Succeeding with Gen Z, millennial investors: Key strategies for financial advisors

For financial advisors, understanding Gen Z and millennial investors – and their generational preferences – is crucial to creating connections, relationships and expanding their client base. We asked financial services professionals what strategies and approaches they have developed to connect with these generations and develop clients.

When asked if she employs different methods of attracting clients depending on their generation, Linda Chavez, founder & CEO of Los Angeles-based Seniors Life Insurance Finder responded, “Absolutely! We tailor our approach to each age group.”

“For example, with Gen Z investors, we are likely to focus more on digital solutions and take a more hands-on approach to engagement. We understand that Gen Z investors are used to having access to information instantly and at their fingertips, so our financial advisors provide them with tailored online advice and mobile apps that allow them to see their portfolios in real time.”

“For millennials,” Chavez said, “we tend to focus on providing long-term guidance and building a relationship with our clients. We understand that this age group is more interested in planning for their future and making sure their financial decisions are aligned with their life goals. Our advisors take the time to really get to know our millennial clients and discuss how they can use investing strategies to work towards their long-term objectives.”

Chavez detailed three strategies based on generation/age of client prospect:

1: Providing Tailored Solutions
Understand that each age group has different needs and preferences when it comes to investing. For example, Gen Z investors may be more comfortable with online solutions while millennials may prefer a more personalized approach.

2: Leveraging Technology
Leverage technology to provide tailored advice and solutions for each age group. For Gen Z investors, we focus on providing mobile apps that allow them to access their portfolios in real-time and understand the markets better. For millennials, we use more sophisticated tools to help them map out their future financial goals and track their progress over time.

3: Building Relationships
Building relationships with clients is essential for long-term success. We work to build trust and confidence in our services by taking the time to get to know each age group, understand their financial goals, and develop strategies that meet their individual needs. This helps us create strong relationships with our clients that last for years.

Working with 'HENRYs'

Brandon Galici, a Certified Financial Planner professional and founder of Galici Financial, says he specializes in “working with HENRYs (High Earners, Not Rich Yet) who tend to be millennials and Gen Z.”

“I used to work more with pre-retirees, so I can certainly speak to the differences in the methods I use to attract a younger clientele,” said Galici. “Previously, it was a lot of phone calls and door-knocking to connect with the older demographic.”

Now, he says he uses three primary methods to reach millennials and Gen Z:

• Technology
• Social media
• Free financial assessment

“Technology is a huge part of my practice. Every client receives access to the invitation-only Elements financial monitoring app. This is our hub where clients are able to be organized and see all of their finances in one place, straight from their phone. This certainly resonates more with the younger generations compared to the few older clients I serve.

“Content marketing on social media has also helped me connect with more millennials and Gen Z clients. I mostly create short-form video content to educate my audience on a financial planning topic. This allows the younger demographic to see how I think and communicate. Plus, I share a relevant #MemeMonday video to showcase my personality even more.

“Lastly, instead of forcing clients to have a phone call with me, I offer a free financial assessment,” said Galici. “A prospect fills out some basic information, and then I provide a 3-5 minute video of my analysis of their financial situation. Since many younger clients are uncomfortable talking on the phone about their money with a stranger, this has allowed them to engage me in a way that they prefer to communicate.”

'Tailor-made strategies' to resonate

Broker Jonathan Brown, who is also founder of the website MeetJB.com, says that understanding generational nuances is essential for client acquisition.

“Our strategies are tailor-made to resonate with the distinct traits of each generation. For Gen Z, we emphasize digital communication and engagement. We engage them via social media, leveraging interactive content, and employ the latest fintech tools to simplify complex financial concepts.”

The recent evolution of investments also drives strategy, explained Brown.

“With cryptocurrency and other digital assets becoming mainstream in 2023, we provide insights into these innovative investment avenues, appealing to Gen Z's tech-savvy nature. Millennials, meanwhile, are more inclined towards sustainability and social responsibility. Therefore, we focus on ESG investing (Environmental, Social, and Governance), showcasing how their investments can make a difference.

“Moreover, being the first generation to face economic challenges like the Great Recession, they appreciate straightforward, honest communication. To connect with younger prospects, it's all about being approachable, relevant, and empathetic to their unique circumstances. It's a delicate dance of staying updated with financial trends while respecting their individuality and aspirations. After all, our success lies in empowering these individuals to achieve their financial goals, irrespective of their age.”

Dennis Shirshikov, head of growth at Awning.com and who specializes in real estate, finance, and investing, says it's important to tailor strategies to resonate with their specific preferences and needs. Here are five ways he says that strategies can differ based on the generation/age of client prospects:

Emphasize digital channels: Younger generations are more digitally savvy and spend a significant amount of time online. To connect with them, we prioritize our online presence and leverage digital marketing channels such as social media platforms, targeted online advertisements, and engaging content on our website and blog. We also optimize our website for mobile devices, as younger prospects often prefer browsing on their smartphones.

Personalized and interactive approach: Gen Z and millennials appreciate personalized experiences. We strive to create interactive and engaging content that speaks directly to their interests and aspirations. For example, we might create informative videos, host webinars, or conduct live Q&A sessions on social media platforms to provide valuable insights and address their specific financial concerns.

Utilize social media influencers: Influencer marketing is particularly effective when targeting younger audiences. We collaborate with social media influencers who have a significant following among Gen Z and millennials. These influencers can promote our services, share success stories, and provide relatable and authentic experiences, helping us build trust and credibility with younger prospects.

Focus on financial education: Younger generations often prioritize financial literacy and seek guidance on various topics like budgeting, investing, and debt management. We develop educational content, including blog posts, e-books, and educational videos, to provide them with the information they need. By positioning ourselves as a trusted source of financial knowledge, we attract younger prospects who appreciate our commitment to their financial well-being.

Incorporate technology-driven solutions: Younger clients are more comfortable with technology and appreciate innovative solutions. We leverage financial technology tools, such as mobile apps for budgeting and investing, online portfolio management platforms, and automated financial planning services. By offering these convenient and tech-driven solutions, we cater to the preferences of younger prospects and provide them with a seamless and efficient experience.

'Experiential marketing'

"One uncommon example of a strategy we use is experiential marketing," explained Julia Kelly, managing partner of Rigits, which provides remote bookkeeping and accounting solution for business.

"This involves creating immersive experiences that allow prospects to engage with our brand on a more personal level. For instance, we may host events where young adults can meet our team, network with other professionals their age, and learn about the services we offer.

"By making these types of connections and giving them a positive experience with our brand early on, we increase the chances they will become long-term clients in the future," she said.

Finally, Alexander Casas at Virginia-based Rock Steady Wealth, Inc., offers advice for the best social media platforms to be on. About 38% of Gen Zers spend 4 hours or more a day on social media, according to a recent survey.

“If you're looking to attract Gen Z, creating mobile-optimized content well-suited for platforms like Instagram, Snapchat, and TikTok is essential,” Casas said, adding, “Video content is significant for this demographic, and partnering with popular influencers can go a long way in driving engagement and building brand awareness. Or creating an educational YouTube channel can help drive younger clients your way.

“For millennials, it's essential to have a solid online presence across multiple platforms, including LinkedIn, Facebook, Twitter, and Instagram,” he said.

Tech-based solutions and personalization also play a role for millennial or Gen Z investors, said Casas.

“Providing value through tech-based solutions like robo-advisors and offering resources to help them better understand financial planning and investment is vital to building trust and establishing your brand as a go-to resource in this space,” he said.

“No matter which demographic you're trying to reach, it's important to remember that personalization is critical. By tailoring your approach to your target audience's unique needs and preferences, you can create a more impactful and effective marketing strategy that resonates with them on a deeper level.”

John Forcucci is InsuranceNewsNet editor-in-chief. He has had a long career in daily and weekly journalism. Contact him at [email protected]. Follow him on Twitter @INNJohnF.

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John Forcucci is InsuranceNewsNet editor-in-chief. He has had a long career in daily and weekly journalism. Contact him at johnf@innemail.