Advisor Advantage

Looking at the big picture, it would seem like millennials would most likely not be interested in receiving advice from an advisor. FC Business Intelligence reported in a survey that only 55 percent of the young generation find financial firms trustworthy. This should not come as a surprise given that only 30 percent of advisors are actively looking for clients under the age of 40.

In fact, many firms and institutions are turning down or aggregating smaller accounts into call centers, cutting out young investors in favor of high-net-worth clients. Wells Fargo Advisors is among numerous brokerage firms consolidating smaller accounts – it encouraged its advisors to drop clients with less than $65,000 in assets. Advisors at firms are also incentivized to have a higher portion of their clients with assets at $250,000 or more.

This doesn’t mean that millennials should be looked at as a disenfranchised segment of investors – if anything, this is an opportunity for advisors to step up where they are needed and benefit from this group in the long-run. Even with the uncertainty felt towards financial firms, millennials want professional advice from both traditional and digital channels.

More than half of millennials see the value in working with an advisor, citing they feel FAs are worth the fees they charge and create an important personal relationship. Not only would millennials benefit from the guidance of professionals, advisors would be building ties with clients who are set to see the largest wealth transfer in history.

While popular opinion may indicate that millennials are bad investors, they actually have all of the makings necessary to be smart, savvy and successful when it comes to investing in the markets. With a little research and guidance, this young generation has the capability to achieve the retirement goals they seem to think are impossible.

Bryce Sutton is managing partner and co-founder of Summit Global Investments, LLC, an SEC registered investment adviser specializing in low-volatility investment strategies. Learn more at www.summitglobalinvestments.com.
 

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