Assets Shifting to Gen X and Gen Y: Is Your Financial Advisor Shifting Too?

Gen X and millennials have been gathering investable assets, and the younger generations have different financial wants and needs from their baby boomer parents. Is your financial advisor on board? millionaires: Financial advisors for Gen X and millennials
5 min read
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Key Takeaways

  • Younger generations want transparency, cutting-edge technology, and full accessibility
  • Financial planning should cover all life stages, not just retirement

As baby boomers pass on their wealth and Generations X and Y accumulate assets, the financial advice and tools available to younger investors are changing.

According to Robert Siuty, a senior financial consultant for TD Ameritrade, what Gens X and Y want most out of wealth management is transparency—being able to see what’s going on with their money at any given time.

“Younger generations are looking for a platform with good technology behind it.  They want something easy to use with quick access to information,”  Siuty said.

In Search of Transparency

Part of transparency is having robust digital platforms that are accessible at any time day or night on desktops, tablets, and smartphones. These devices give Gen X and Y investors instant access to their money so they can take investment actions only when they want. But transparency goes beyond an on-demand view of the bottom line.

Intertwined with transparency and access is knowledgeable customer service that's available at any time. Siuty explained that TD Ameritrade Client Services specialists are available 24 hours a day. “Gen Xers and millennials want to do business with someone with whom they feel comfortable and confident. They want an excellent client experience with the right guidance at their current life stage,” he said. 

Goal Planning Isn’t Just Retirement

Gen X is the “sandwich” generation, taking care of aging parents while also raising children. The type of financial planning available now helps people at all life stages, not just retirement.

Financial planning today is more holistic, a concept that didn’t exist several years ago for younger investors. Previously, brokers who worked with non-retirees focused almost exclusively on investment performance, while retirees received more comprehensive advice. Siuty stated that while planning is important at all life stages, younger generations tend to have different areas of focus compared to older generations. Younger generations tend to focus more on accumulation goals like saving for college, making sure they are saving the most efficient way for retirement, and having the right budget in place. Older generations instead might want to focus on efficiently distributing their assets for funding their retirement income or legacy goals.

A Matter of Trust

Trust is paramount because this generation experienced the dot-com bust of the early 2000s as well as the global financial crisis of 2007–08. A lack of transparency in the financial industry played prominently in the news at those times. Those experiences have also molded the investment attitudes of younger people. Siuty pointed out that many prefer to hold cash rather than stocks or bonds because they don’t fully understand or trust the markets. 

“They’ve experienced some pretty tumultuous times in the markets,” Siuty explained. “They understand cash; they see the $50,000 in savings today will be the same $50,000 a year from now.  However, what they often don’t realize is that inflation erodes the purchasing power of that cash over time, and this is why education around investing is so important.”

But Gen Xers and millennials who find financial advisors they trust with their money might be willing to have more diversified portfolios compared to baby boomers who stuck with a traditional portfolio of mainly domestic securities.

“We’re all plugged in with digital technology and news sources,” Siuty explained. “So when you talk to younger people about diversification from a global standpoint, they’re much more receptive.”

In the end, much comes down to experience and openness when dealing with younger investors. But robust, accessible technology is certainly a plus. “The best fit for them includes strong digital platforms, access to good educational resources and attentive personal services, which is transparency at its best,” Siuty concluded.

All investing involves risk including the possible loss of principal


Key Takeaways

  • Younger generations want transparency, cutting-edge technology, and full accessibility
  • Financial planning should cover all life stages, not just retirement
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