“Young people might know and prefer technology, but that only makes their desire for human connection more important,” said McKinnon.

The kinds of financial decisions they are wrestling with—whether to open a 529 college savings account for their kids, whether to buy a second property for rental income—are complex and require human interaction. “I don’t think robo-advisors are going to cut it when it comes to giving them the advice they want and need,” she said.

Myth #4: NexGen Wants To Give Its Money Away

The last question about stereotypes concerned whether NexGen clients want to give their money away.

That’s only partially true, said Doder. They understand life’s expenses, and they want to live nicely, to travel, to “do a lot of things.” But they also want to give back to their communities when they can—and they don’t want to wait until the end of their lives to start their charitable giving. Their advisors should help them plan for all these different priorities.

Creating A Business Model For Serving NexGen Clients

The conversation then moved to how to create a realistic business model for addressing NexGen clients. McKinnon said that, because younger clients don’t have much wealth yet, “we have to take the AUM model off the table, at least until we get to the point where they qualify for that.”

So rather than charge a fee based on assets, she suggested advisors ought to instead use something akin to the model concierge medicine uses—perhaps an annual subscription fee for advisory help available as needed. “While we’re not helping clients with their health, we are helping with their financial well-being,” she said.

Another option she suggested would be a fee charged to clients based on a percentage of their income.

“It’s not the clients who have to be different. It’s really we who have to think differently,” said Doder. She said Aspirant had launched a service called “Emerging Wealth” for clients who don’t need the traditional level of service. There was really no point in over-serving a community who really don’t want that kind of attention, she said.