Why We're Valuable (Part I)

While our generation has begun to establish itself as valuable members of the workforce, the financial services sector has yet to reciprocate in kind. Within its traditional business model, Millennials aren’t profitable clients (i.e. we don’t have enough investable assets), so we are ignored.  The firms that assist Millennials simply package the same services they provide older clients in a different wrapper.  Their services are expensive and do not provide lasting value.

Our generation entered the job market in the midst of a perfect economic storm that I call the Millennial Disadvantage, which you can read more about in my book of a similar name (buy a copy here). Because of this, our earnings potential has been dampened and, traditional milestones such as homeownership and marriage are being postponed.  Older generations may think of us as “slacking off” but what they don’t get is that this is a reasonable response to an environment increasingly characterized by uncertainty, tinkering and the search for meaning and purpose.

The financial services industry is rapidly aging. The average age of a financial advisor is around 50 and according to the CFP® Board, 75% of CFP® Professionals are over 40 years old.  Older advisors don’t identify with our generation but, most of all, they simply don’t understand us.

Recently, evidence has surfaced that a few traditional advisory firms are beginning a half-hearted attempt to alter their service models and market Millennial clients.  But it’s already failing because there is no real desire to spend the time and resources on our generation.  Instead, their efforts are an indirect response to a more personal goal: to retire. Nowadays, you can’t sell a book of business for much, so aging advisors are bringing on younger advisors to eventually buy the business.  These “junior” advisors primarily help service existing clients, but they also try and build their own business of younger clients. Their marketing attempts are often ineffective because they are forced to operate in the confines of their employer’s dated business model.  Basically, they’re just tweaking the same services they offer to their older clients.

There’s a lot of content floating around the internet about how to market to Millennials. These articles capture some of what makes our generation truly unique. But it doesn’t go to the heart of who we are, precisely because the primary goal of these so called “experts” is to teach others how to market to us. For the most part, these articles use “modern” language to sell dated financial services. It doesn’t take these firms much, beyond keywords to design an entirely new method of financial service. What I’m trying to say is that despite a set of much-hyped products supposedly designed to appeal to Millennials, the industry isn’t stepping up to the plate.

This attempt to create a Millennial-focused service is halfhearted. Many Millennials do not succumb because we’re naturally skeptical and there is little value.  In other words, the services aren’t worth the cost. Our generation is not willing to pay 1.5% to invest in a basket of index funds, which can be purchased from a robo-advisor for .25%. We don’t need a buddy that holds our hands and teaches us to save and budget.  We already exhibit better financial discipline than we are given credit for.  We’re skeptical, entrepreneurial, cautious and prioritize meaning and purpose over material wellbeing.

Grow recognizes the untapped potential of combining our strong habits with our need (not necessarily desire) to make money. Take the bad economic hand that we have been dealt, add in our healthy habits, and we have the ingredients for a major breakthrough.

Millennials can and should be at the forefront of a new, more holistic approach to financial service, and to integrating money with a broader vision of a fulfilled life. But our generation needs help defining that vision, and in laying out the journey to get there. In order for that to happen, I’ve taken upon a larger mission: to expand the value I provide to Millennials into non-financial realms.

We experience a great deal of lasting change in our twenties and thirties. If we want to establish good lifelong habits, this is the time to do it—which is why one thing we shouldn’t delay is developing the habits of consistent personal growth.  More than financial capital, we must create self-capital, or experiences and skills that compound over and over and create long-term value.

The traditional language of financial planning doesn’t speak to this period of exploration in which so many of us experience. Financial terms like wealth accumulation don’t resonate with a generation that sees maturation as a process, a prolonged journey, and who are more concerned with finding their purpose and gathering an abundance of experience.

Yet that doesn’t mean our generation doesn’t need guidance, and help in putting together an action plan for that journey. It’s crucial to work with someone that will help you explore your life with intention, purpose and dignity, or you’ll find yourself turning forty and feeling that the past somehow got away.

This is where Grow is truly different than other firms.  My primary responsibility as an investment advisor is to help Millennials invest in themselves.  I’m stepping forward to offer a more extensive, holistic set of services that integrates finance and life, goals and purpose, money and meaning. At Grow, we speak a different language, and we walk the walk. We’re redefining wealth and value by embracing not just the material and financial aspects, but also experience, purpose, community, and fulfillment.

Grow is my attempt to satisfy an untapped field of unmet needs. Job-hopping has become the norm for Millennials, who typically leave a job after a few years. This deprives many of us of the kind of mentoring relationships afforded by long-term employment. I strongly believe that providing a mix of financial and life coaching is invaluable. Our generation certainly craves this kind of support as studies show Millennials are interested in self-improvement, and willing to invest a good deal of money in it.

I have more to say on this...stay tuned for part II