The wealth of millennials is rising faster than that of any other demographic group. They want advice and now want to pay for it.

That’s the upshot of a report by Cerulli Associates released last week. The consulting firm said that millennials in its research had an average net worth of more than $278,000 in 2021,which reflected a 23.1% annual increase since 2016. That was a higher growth rate than that enjoyed by other generations. The firm also said that 59% of millennials identify as advice seekers.

The results come from “The Cerulli Edge—U.S. Retail Investor Edition" for the third quarter of 2022.

“While millennials historically have had a high rate of direct provider platform use, resulting in substantial targeted marketing from brokerage platforms and digital advice providers, increasingly they are demanding more personalized advice, including comprehensive financial planning,” the report said.

This partly has to do with where millennials are in their lives. This generation, which the firm defines as those aged 25 to 41, are in a place where they are making decisions about starting families, buying homes, getting married and seeding retirement accounts—all the kinds of questions that might make a robot advisor shrug.

The advisors they are likely going to meet first are those associated with banks, said John McKenna, a research analyst at Cerulli.

“That makes sense,” McKenna said in an interview with Financial Advisor. “That’s your first interaction—you walk to your local Bank of America. You walk in the door and you say I want to open a checking account, I want to open a savings account, I want to open a credit card. … As time goes on you start meeting with the bank’s advisory team. You’re already there. The bank says, ‘Maybe you’d like some more advice on things like mortgage rates, maybe managing 529 plans, maybe managing savings.”

As things progress and millennials get wealthier, they are likely to start asking themselves whether they should be going to independent advisors or full-service brokers or some specialist.

“People are not in love with their deposit bank,” he said. “It’s very transactionary. It’s ‘I want to get money out. You take money out. Thank you. I got my money.’ There’s not a lot of emotion there. But when you’re talking with an advisor, it’s personal. He knows you. You know him. You get into conversations. You start to understand him, he starts to understand you.”

That emotional relationship is what can keep an advisor for decades where transactional relationships can’t, McKenna said.

Cerulli said that fewer than 10% of millennial households had more than $100,000 in total financial assets in 2016, but that’s risen to 25% because the market has appreciated and millennials have been able to save more. The increase has meant more of them are tripping into the affluent and mass affluent categories—where people are more likely to seek out financial help.

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