Tim with his family
As you approach parenthood for the first time, everyone tries to prepare you by sharing their own experiences. The one I heard about most often was to prepare myself for the lack of sleep. Unfortunately, you do not hear as much about the financial adjustments you should be prepared to make as well.
As financial advisors, you have an unbelievable opportunity to help your clients at times of transition and change — whether that is buying a home, getting married, caring for a parent, changing jobs/careers, health issues, death in the family, divorce, parenthood, etc. These are all times to add value to relationships while helping clients make smart financial decisions.
Many of my friends are also new parents and many of them have reached out recently for guidance on college savings, retirement savings and estate planning. (Of course, none of them call it estate planning, but just want to make sure that their family is taken care of if an unforeseen circumstance occurs.) Most of these friends are not necessarily concerned with which investment is better than another — they want to know how much they need to save, what account types are appropriate for their situation, and what documents need to be drafted so that their family is covered in the event of an unforeseen circumstance.
This group does not fall into the typical “millennial” stereotype that you read about in The Wall Street Journal. Typically they are ages 28-38, married, have 1-3 children, own their home, both spouses work full time, they value family, generally have or will receive an inheritance from parents or grandparents, exercise regularly, eat healthy and are beginning to feel they have enough money to invest. For many in this group, this is also the first time they have felt they truly need to take personal finances seriously with newly added responsibilities.
I often read headlines providing marketing ideas for advisors wanting to attract “millennials.” I thought I’d provide a few ideas for how advisors can try and connect with this group. Quite often, these are your client’s children.

  1. Start bringing, or offering to bring, the client’s children into your meetings if you haven’t already.
  2. If they are considering a new home purchase, offer your resources and time around budgeting, mortgages, tax considerations, trusted agents, etc.
  3. If they are expecting a baby, offer assistance on what they may be entitled to from the state and/or employer for time away from work and compensation. Help them budget if one spouse will stay home for an extended time. Help them budget for costs like diapers, clothes, baby wipes, formula, daycare, etc. Make sure they know you can be their go-to person for helping them begin a college savings plan, emergency fund, insurance needs, estate planning, etc.
  4. If your client mentions that their child is considering changing jobs, be the resource for helping them navigate a new 401(k) plan and benefits package.

If you do these things, you will be their trusted advisor when it comes to the investments. As difficult as it might be for you, try to not to worry about how you will “get paid for your time” with these potential clients for now. Instead, this should be viewed as an opportunity to add value to your existing clients’ relationships (parents) and set the foundation for the next generation to be loyal clients in the future.
Now, how do you begin to get this group engaged if they are not immediate clients? A good starting point would be to leverage MoneyGuidePro’s SmartPortal (available through Loring Ward’s Investment Planning Center). Use My Snapshot to help them visualize their current net worth and center the conversation on decision-making that can help them build upon where they currently are. If you want to take it a step further, add Yodlee account aggregation for $1/day and all of these potential clients will have a similar portal to what offers, while providing you access to accounts they choose to share with you.
Finally, if you add the Financial Goal Plan you can begin to help them clarify goals like college savings, retirement and purchasing a home, while pointing out likely gaps like life insurance and estate planning documents. MoneyGuidePro provides an effective platform for engaging this group if positioned properly. It should be viewed most importantly as a behavioral tool to help them visualize their goals and reinforce your guidance.
Most importantly, see this as an opportunity for you to begin a new client relationship and have a tremendously positive impact on people that need your help.