The future of your practice depends on attracting and retaining younger clients. And right now, younger clients are actively seeking your advice, as the COVID-19 pandemic hits them from all sides—triggering worries about health and safety, fears for loved ones and concerns about financial security.

In fact, nearly half of Americans ages 18–34 (45%) are relying on an advisor more than ever—and nearly four in 10 (39%) have engaged an advisor for the very first time—according to a recent Nationwide Retirement Institute survey of American adults aged 18 or older, including investors with investable assets of $100,000 or more.

Twice In A Lifetime
Younger clients have already faced their share of financial challenges. Coming of age during the Crash of 2008 and the Great Recession made them wary of market risk. Outsized levels of student loan debt caused many to put important life decisions on hold—from buying a first home to starting a family—as they worked to build a solid financial foundation.

Now, as the pandemic has put their job security in jeopardy with the highest levels of unemployment since the Great Depression, and their portfolios are pummeled by a toxic mix of recession, volatility and looming bear market, younger clients are steeped in their second “once in a lifetime” black swan event. The struggle is real, and so are their fears.

Blindsided By The Pandemic
Americans ages 18–34 feel a lack of control and an urgent need for more guidance. Nearly three-fourths (74%) said that even if they do all the right things to manage their finances and investments, they can still be blindsided by outside events like the pandemic. As a result, more than two-thirds (67%) said they need help managing their finances and investments to succeed in the future. Only 10% said they do not expect COVID-19 to impact their ability to meet their financial obligations. The vast majority need your advice.

Younger Americans fear the pandemic’s near-term impact. Americans ages 18–34 are more likely than all American adults to say their top COVID concerns include being unable to pay bills or meet financial needs (54% vs 45%) and losing their employment (44% vs 30%). Both are equally concerned about losing their life savings (both 33%). Younger Americans are slightly more concerned about being unable to afford health care (29% vs 27%), and only slightly less concerned about being unable to retire as planned (20% vs 21%).

At Risk Of Locking In Losses
Under the pressure of the pandemic, younger clients are not always prepared to make the best choices. When COVID-19 impacts their ability to meet their financial obligations, Americans 18–34 are more likely than all American adults to take “unfavorable” actions, such as to delay paying their bills (32% vs 24%), increase credit card debt (23% vs 18%) and stop paying bills (15% vs 10%). They are also more likely to fill a budget shortfall by taking a loan against their qualified retirement plans (15% vs 11%) and their non-qualified investments (10% vs 7%). Worse yet, they are more likely to risk locking-in long-term losses by selling shares in their qualified retirement plans (13% vs 10%) to meet current financial obligations.

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