Advisors Must Get Online To Attract Conservative Younger Market - Accenture

Sally Ling

8 February 2013

Investors between the ages of 21 and 30, known as “millennial investors” are more conservative and less trusting of financial advisors than their older counterparts, baby-boomers (age 46-70) and generation X (age 31-45). The younger generation are also more inclined to consult other sources before accepting financial advice, according to research by Accenture.

The survey found that 40 per cent of millennial respondents are “determined” to pass along wealth to their families, compared to 25 per cent of baby boomers and generation X investors. In addition, 44 per cent of the youngest group said they were extremely interested in improving their understanding of investing compared to 38 per cent of older respondents.

Accenture says that, counter to prevailing wisdom, the research suggests millennials are a highly viable target for advisors. The survey points to unmet demand for online investor education and advisor-interaction tools that could increase millennial investing and help bridge the “trust gap” with financial advisors.

According to Accenture’s research, there are more than 75 million digitally savvy investors in the US with high income, assets and education. This highly-coveted investor demographic, upon which the survey focused, makes up 44 per cent of the online, US population, aged 18-65 and represents approximately $27 trillion in total assets.

“With half of all baby-boom investors currently active in social media and a vast majority active online, the innovations that will capture the millennial generation also will help capture the most coveted demographics among Gen Xers and baby boomers … Wealth managers who provide transparency, education and tools that make investing easier to understand - and those that provide the rationale behind their recommendations - will be positioned to achieve trusted advisor status among market-leading demographics,” Alex Pigliucci, global managing director of Accenture Wealth and Asset Management Services, said in a statement.

Accenture commissioned an online survey of 1,005 high-income, technology literate US investors regarding their relationships with financial advisors. Respondents included 253 baby-boomer consumers (median net worth $655,000), 251 Gen X consumers (median net worth $238,000) and 501 millennial consumers (median net worth $70,000) – with an even mix of men and women.