How to attract next-gen clients

It won’t be long before Gen Xers and millennials will seek financial advice in far greater numbers. In fact, they could make up about 40% of clients within the next five years, estimates Kate Healy, managing director of TD Ameritrade Institutional's Generation Next division.

The problem: Many RIAs are not prepared to meet those clients’ needs, she says.

For Financial Planning’s Lightning Round, Healy fielded rapid-fire questions about how advisors can not only reach this next generation of clients but also recruit younger and more diverse talent to the profession.

LIGHTNING ROUND: 1 minute with Kate Healy. Managing Director Generation Next TD Ameritrade

QUESTION: Biggest threat to RIA growth?

HEALY: RIAs are not paying attention to the next generation of clientele.

QUESTION: Clientele in 5 years?

HEALY: In five years, almost the majority of their clients are going to be Gen-X and millennial clients. They need to think of a different service offering.

QUESTION: How to attract next-gen clients?

HEALY: It’s not just about investments. It’s about giving them a holistic view of their financial picture. Giving them advice on career, retirement savings, debt management.

QUESTION: Fee changes needed?

HEALY: We need to think outside of the box of just charging AUM and investments and think about, how do we charge a fee for advice? How do we make it palatable to next-gen? Monthly retainers, monthly subscription models?

QUESTION: Where to find talent?

HEALY: Advisors need to get on campus and go to the financial planning programs, meet with the program directors to find your next-generation interns and associates.

QUESTION: How to attract women to the profession?

HEALY: We have to talk about what we do and showcase successful women advisors. You can’t be what you don’t see.

QUESTION: Why is diversity important?

HEALY: By 2045, we will be a majority-minority country. If we don’t have more minorities into this profession we will not be able to serve the clientele.

QUESTION: Favorite book?

HEALY: “Quiet” by Susan Cain.

QUESTION: Favorite app?

HEALY: Pandora because it is a lifesaver when I’m on the road. Huge music fan.

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