7 strategies for winning next-gen clients

How to be the advisor for decades to come?

According to research from Cerulli Associates, by 2048, nearly $105 trillion in wealth will go from Baby Boomers and older generations to their heirs in the Great Wealth Transfer. And as that wealth changes hands, advisors have an opportunity to connect with these next-gen clients and set their firms up for success for decades to come.

In an ideal world, an advisor would automatically win the next generation of investors. But that’s not always—or even often—the case. Recent data from The Harris Poll found that nearly half of younger Americans (43%) plan to switch asset managers from their parents’ current provider after they receive their inheritance.

Clearly, a pre-existing relationship isn’t enough to get you in the door with the next generation of investors. So, the question is, how do you position yourself as the right asset manager for millennials, Gen Z, and younger generations to come?

Let’s take a look at seven strategies that will help you win this next generation of clients—and position yourself as an effective asset manager for younger clients.

Strategy #1

Treat next-gen clients like new clients

Next-gen clients won’t necessarily inherit their parents’ advisor relationship—it’s one that has to be earned on its own terms. That’s why it’s helpful to see these heirs as a brand new partnership.

Think about what you do when you’re trying to win a new client. How do you make the initial connection? How do you show them that you’re the right advisor for their long-term financial goals? Whatever strategy you typically use to win new business, apply to next-gen clients.

For example, regular contact is a must for securing new business. So, as you’re trying to secure next-gen partnerships, it’s important to have a strategy for when, how, and how often you’re reaching out.

And while there is no “one-size-fits-all” cadence for potential client communication, it’s important to note that if you want to win this next generation of investors, you’re probably going to need to be reaching out more than you’re used to—and more than you connect with their parents.

According to research from The Harris Poll, 42% of younger Americans said they want to consult with their financial advisor at least once a week—compared to just 4% of older investors.

Strategy #2

Use your existing relationships to get in the door

Now, while you’ll want to build trust with next-gen clients in the same way you approach connecting with new clients, that doesn’t mean you have to start from ground zero. You can (and, in most situations, should) use your existing client relationship to your advantage—and as a way to “get in the door” with the next generation.

For example, you might invite your client’s children to annual reviews or schedule financial meetings with not just your primary client, but their entire family.

Then, as you start to build the relationship, you can look for opportunities to connect with next-gen clients directly—for example, by scheduling one-on-one meetings to talk about their future financial goals, educating them on relevant wealth management topics (like tax-efficient investing or estate planning), or reviewing your advisory services, financial services, and what you can offer in a partnership moving forward.

Strategy #3

Combine digital and IRL support

Many financial professionals assume that younger investors prefer to connect with their advisors and manage their investments via the digital space. And there is definitely some truth to that. As Grealish said in his recent interview:

“Younger generations are…digitally native. They’re not going to expect to consume information about their portfolio investments through monthly statements mailed to them, or emailed to them. Folks are going to expect to be able to have 24/7 access through a thoughtfully designed digital platform, to have digital-first interactions.”

However, for many next-gen clients, digital channels are just one piece of the puzzle. In addition to digital support, many younger investors also want to forge a more analog, real-life relationship with their financial advisor. For example, while the Harris Poll found that 17% of younger investors want a digital relationship with their advisor, it also found that those investors actually prefer in-person (29%) or phone (24%) interactions with their financial planner over digital methods like email (19%) or text (17%).

So, if you want to appeal to next-gen clients, it’s important to take a hybrid approach to the relationship—and offer a variety of ways to communicate, connect, and work together, both in the digital space and the “real world.”

For example, when working with younger investors, you might give them access to Altruist’s client portal, where they can access their portfolios and investment information 24-7, in real-time, from any desktop or mobile device—and then supplement that digital experience with quarterly in-person meetings, educational opportunities, and/or frequent phone calls.

Strategy #4

Show next-gen clients the value only you can provide

For next-gen clients, investment tools like AI-powered robo-advisors or self-directed index funds are not only the norm, but—in many cases—the go-to. For example, research from SurveyMonkey found that Robinhood is overwhelmingly the investment platform of choice for millennial (40%) and Gen Z (32%) investors.

And as these tools have become increasingly popular with younger investors, there’s one question you can pretty much guarantee will be on their minds when they’re deciding whether they want to work with you: “Why do I need to hire you—when these tools can deliver the investment support I need for free?”

If you want to secure those clients, you need to not only answer that question, but actually show them the value you, as an advisor, can offer—the value they will never be able to access if they stick to these digital, DIY investment tools.

For example:

• Private market access. Alternative investments like private equity and private credit are typically only available through financial advisors—and that can be a major selling point for younger investors looking to diversify their portfolios beyond the traditional stocks and bonds available via consumer investing apps. (With Altruist, the entire alternatives experience, from fund discovery to paperwork to billing, lives within the platform—making alternative investments available for clients in just a few clicks.)
• Portfolio-backed borrowing. With tools like Altruist’s margin loans, advisors can help investors borrow against their own investment portfolio—without selling their position. This liquidity strategy is accessible via advisory services—and can be a great way for younger investors to access needed funding (for example, to purchase a house or fund a business venture) without sacrificing long-term growth.
• Personalized financial planning. DIY tools can track a portfolio—but they can’t replace a human advisor who understands a client’s full financial picture. Advisors can offer personalized financial advice that’s tailored to the client’s specific goals or circumstances—for example, navigating a job transition, building an estate plan, or setting up college funds for their children.

Strategy #5

Embrace AI

AI is everywhere, including wealth management—and for many next-gen investors, AI competency is a must-have quality for financial advisors. For example, according to a recent study, 54% of millennial and Gen Z investors say they want to work with a financial advisor who understands and actively uses AI in their role—almost 20% more than Boomers (36%).

And it makes sense. With the right AI tools, you can streamline your operations, automate time-consuming tasks, and significantly reduce the time and energy required to deliver high-quality work—all of which allow you to provide a higher level of service and a better experience for your clients. As such, if you want to appeal to younger investors, embracing AI is an absolute must.

But not all AI is created equal. So what, exactly, are the “right” AI tools for financial advisors?

If you want AI to make a real impact in your firm and for your clients, avoid generic platforms and instead, look for tools that speak directly to the work you do with clients—like Hazel, Altruist’s transformative AI engine.

For example, Hazel AI Tax Planning reads 1040s, paystubs, meeting notes, email, custodial data, and other key tax-related documents to help advisors create personalized tax strategies and client plans in minutes.

When you embrace AI—and use it strategically in your business—you can essentially offer clients the best of both worlds. By combining the efficiency and intelligence of AI with the experience, support, and guidance of a real-time advisor, you can add more value and a better client experience than both DIY AI-powered finance tools and less tech-savvy advisors—which can help you stand out to next-generation clients.

Strategy #6

Lead with values, not just returns

Next-gen clients view wealth differently than older generations; for example, according to data from The Harris Poll, while older Americans are most likely to view wealth as a path to security (42%) or a tool to live their desired lifestyle (25%), younger Americans see wealth more as a way to build their legacy (22%) or to achieve personal fulfillment (18%). And as a result of this perspective shift, for many next-gen clients, values alignment isn’t a nice-to-have—it’s a non-negotiable. 

This identity- or values-centric approach to wealth building and management is reflected in how next-gen clients find, hire, and work with advisors. Some of the top reasons heirs cited for leaving their benefactors’ financial advisor included not having a similar investment philosophy (38%), values not aligning (33%), and the advisor lacking trustworthiness and integrity (25%). In addition, a recent report on sustainable investing found that 90% of millennial investors said they would choose their financial advisor based on their sustainable investment offerings.

So, if you want to get in the door with the next generation of investors, you need to lead with values—not just returns. 

What does that “leading with values” look like in practice? As you’re getting to know your client, ask what’s important to them; what industries, businesses, and/or causes (like sustainability or climate change) they support; and if there are any investment strategies or opportunities that feel misaligned with their values. Then, use that information to suggest financial strategies that help them not only grow their wealth, but also use it in a way that supports their personal values and the good they want to do in the world. 

You should also highlight how, as an advisor, you can better help next-gen clients navigate values-based investing vs. trying to invest on their own. For example, with DIY apps and tools, investors have limited options, like stocks and pre-built funds. But with Altruist’s personalized indexing, advisors can offer next-gen clients tax-aware, customized portfolios at scale—including portfolios that align with their specific values.

Strategy #7

Connect via content

If you know anything about marketing, you know that if you want to appeal to a certain demographic, you need to connect with them where they already are. And if your target demographic is younger investors, “where they already are” is on social media platforms. 

According to research from Blackrock, roughly half of high-net-worth investors report being more likely to engage with an advisor who has an active social media presence—and nearly one-quarter of Gen Z adults (23%) say they wouldn’t even consider a financial professional that wasn’t publishing content on social media. 

Whether you’re looking to lock in next-gen clients or just to appeal to younger investors in general, the data is clear: publishing content on social media can be an incredibly effective way to do so.

• Choose one platform. To keep things manageable, think about what kind of content you like to make. If you’re skilled at creating video and visual content, go with Instagram; according to data from Sprout Social, 76 percent of millennial social media users are on the platform. If you want to focus more on text-based content, go with Threads. Not only are Threads users significantly more engaged than X users (On average, Threads posts have nearly 74 percent higher engagement rates than X), but many of those users would fall under the next-gen category (millennials and Gen Z are the most active users on Threads, with each generation having a 17 percent adoption rate). 
• Create the right kind of content. If you want your social media content to land with your ideal clients, creating content isn’t enough; you need to create the right kind of content. Think about what your next-gen and younger investors need to understand the most—for example, financial planning, taxes, inheritance basics, or how to purchase their first home—and then create content that speaks to those topics.
• Focus on value—not volume. When it comes to content, value always outweighs volume. Rather than trying to post every day, focus on creating content that packs a major value punch. That being said, consistency is important on social media—and sticking to a posting schedule is crucial for ensuring your content gets in front of your target audience. So while you don’t need to publish every day, you do need to choose a cadence that works for your schedule—and stick with it (for example, posting every Wednesday).