In short, Millennials emerge from the research as one of the most complex, important and demanding groups of clients for wealth managers to understand and serve.

On the upside, Millennials’ need for high quality advice and support over a period of decades presents a huge potential opportunity for wealth managers able to meet their requirements. Set against that, firms are likely to find it increasingly hard to reconcile Millennials’ desire for more and more specialized advice with their tendency to spread assets between providers and their price sensitivity. For example, this cohort is more concerned (66%) than the average client (54%) about hidden costs.

Furthermore, the research shows that long-term success with this group of clients will depend on wealth managers’ ability to build a sophisticated picture of individual investors’ mindsets and behavioral traits.

A closer look at Millennials’ investing behaviors shows that this generation demonstrates a heightened level of sensitivity, coupled with a marked lack of predictability. Millennials appear to react strongly – and inconsistently – to volatility. No fewer than 50% of this generation (compared to 34% of all clients) reacted to recent market shocks by moving capital into savings and deposits. However, volatility also prompted 47% of Millennials to increase their allocations to actively managed investments (compared to 34% of all clients).

This suggests that wealth managers have a crucial role to play in providing younger investors with a steadying hand. Firms not only need to offer advice and guidance, but to actively educate Millennials on topics like goal-setting, risk appetite and diversification.

Fostering investment behaviors that optimize long-term outcomes will be essential, too. This might involve encouraging positive traits – such as the willingness to embrace new products – while tempering less productive impulses like overreacting to market corrections.

The good news for wealth managers is that Millennials are more open than other cohorts to sharing their transactional data, social media profiles and even GPS locations with providers in exchange for greater personalization. Despite their comfort with digital channels, Millennials also value the ability to discuss matters with an advisor – whether virtually or in person.


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