Daily Management Review

Millennial Customers Most Lucrative for Financial Advisors in 2015: Hartford Funds Survey


Millennial Customers Most Lucrative for Financial Advisors in 2015: Hartford Funds Survey
There is good news for the financial advisers if the analysis of Hartford Funds is to be believed. The form has suggested that in the next couple of years, Youth clients can be the prospective targets for financial advisers, a target group that the advisers have been pro-actively following and yet not utilizing.

The Hartford Funds suggests that there is significant opportunity for financial advisers to better engage their young clients while clarifying the that most advisers report not pro-actively pursuing the ‘Millennial’ generation as potential clients.

Survey findings by the firm have also revealed that client risk aversion is also expected to nearly double in the next 12 months as expected by advisers. This would also be an upward trend.

These facts were revealed in the third annual Advisor Anxiety Survey by Hartford Funds. The survey was conducted after speaking to more than 100 financial advisers about their anxieties as well as attitudes and practices regarding Millennial client.

Millennial clients are defined as those individuals born roughly between 1980 and 2000.
Nearly half of the financial advisers (56%) conceded to paying lesser attention to focus on attracting Millennial clients and there reply was that they gave lesser attention compared to other age groups or no attention at all.

However more than 70 percent of the financial advisers surveyed said that they do pay attention to the target clients in their late-twenties and early- to mid-thirties.

“The term ‘Millennial’ has become a buzzword in financial services, being discussed constantly by financial firms and advisers. However, our survey suggests a disconnect when it comes to understanding who falls into this Millennial category,” said Bill McManus, Director of Strategic Markets at Hartford Funds.

“In an attempt to filter noise, many advisers might be missing valuable insights for attracting their younger client targets,” he added.

The survey however found out a trend among the financial advisers where 71 percent of financial advisers said that they plan to work for at least 16 more years while 53 percent of them plan to work for more than 20 years.

The study concluded that while the financial advisers are inclined to work beyond 2030, they are not focused on attracting Millennial clients. Advisers who plan to work for 15 more years are do not have plans to target Millennial customers to any significant degree and rather have plans to advice and approach other age groups. In a similar fashion, Millennials customers are targeted less than any other age group or not at all by 51 percent of advisers who plan to work for more than 20 years.

 “When factoring in career longevity, there is even greater concern that many advisers aren’t intentionally engaging Millennial clients. Advisers who plan to work for at least two more decades need to thoughtfully engage their younger clients in order to grow along with their needs,” McManus says.

“Millennials will reach critical planning milestones in the coming ten years and require support in navigating the market and reaching their goals,” he opines.

These attitudes toward Millennials is despite the fact that 57 percent of financial advisers interviewed expect clients to become more risk averse in the next 12 months which is 22 percent more than the similar figure in 2014.

“Because advisers foresee greater risk aversion among clients in the coming months, they are in the unique position to help maintain focus on the bigger picture and minimize clients’ tendencies to make emotionally-driven investment decisions,” McManus added.


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