To broaden the demographics of your client base, it is essential to invest in early career advisors
Attracting young clients to your firm can be a daunting task. These investors can often appear out of reach and are certainly not drawn in by traditional recruitment methods that work with an older audience.
To address what we saw as a growing demographic issue at The McClelland Financial Group of Assante Capital Management Ltd., we began prioritizing the hiring of young advisors about two years ago, an initiative that has paid off extraordinarily well. The next generation of investors are looking for a wealth advisor they can relate to – they do not want to deal with their dad’s advisor. The last three advisors we have brought onto our team have been 22 years old.
Not only has adding youth to our team facilitated better engagement with younger investors, but it has added a noticeable boost in energy throughout the office. It may be intuitive to look for more experience while recruiting a new candidate, but by adding a jolt of youthfulness and work ethic, we are now able to access potential clients who would otherwise be unreachable. It also goes without saying that this generation of advisors is more comfortable using technology and digesting large amounts of information. For them, using tech is like speaking or walking – our new advisors take to the latest software developments like a duck to water, improving our office’s efficiency and productivity.
With a more youthful team, we have been able to hone in our social media presence, an aspect that just was not resonating with a younger audience before their arrival. Now, we have many prospective clients reaching out to us after accessing our increasingly successful YouTube videos and podcasts, where we have been posting weekly content specifically targeted at a youthful audience.
With young investors, you cannot simply set up a portfolio and send them on their way. Retirement, insurance and tax plans are all part of a comprehensive strategy we employ to ensure the financial security of these clients, who have many moving parts in their lives.
The returns we make from our young client base are generally quite modest, as their cash is very fluid while they make major purchases on homes or vehicles. It is often difficult to justify the intake of a new client, as they may not have enough saved to truly need the services we can provide. But by targeting this demographic, we are investing into the future, a strategy that allows us to diversify from our retirement and pre-retirement age client base. If all your clients are 80 years old, you will be facing some significant issues 10 years from now.
Hands-off financial services such as Wealthsimple and Questrade are incredibly popular with young investors, but this demographic is the least prepared to jump into the financial world on their own. They usually have not experienced a market correction, and often do not have adequate life experience to guide them through testing times.
In this digital age, it is difficult to discern what is real and what is fake. Social media is full of bad actors with vested interests and no regulation, leaving youngsters vulnerable to deception. Without the skills of a talented advisor, these young investors are at risk of watching their portfolios vanish in front of their eyes.
We know the services we offer can positively impact the financial lives of the next generation of investors. And while we still have a long way to go to reach our demographic goals, we are confident that the move to inject some youthfulness to our team will only continue to pave the way to a successful future for our firm and our clients.
Mike Connon is a Senior Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at (905) 771 - 5200 or visit www.tmfg.ca to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a Member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization.
