Q&A  

How to get younger clients on board with financial advice

How to get younger clients on board with financial advice
Photo: Helen Thomas, chartered financial planner at FPC

Why is it so hard to find younger clients? Or perhaps it is a case of working out how to get to them early?

In this latest interview, Helen Thomas, chartered financial planner and winner of the Insurance Institute of Liverpool's young achiever of the year award, tells FTAdviser the issues that young people face in regard to their finances.

She also explains how to overcome a possible age gap between these younger clients and advisers. 

FTAdviser: We recently reported that 6 per cent of financial advisers are under 30. Have you experienced this age disparity? What do you think can be done to help younger people get into the profession?

Helen Thomas: It doesn’t surprise me that only 6 per cent of advisers are under 30, you only need to look at conference attendees to see that there is a shortage of younger people in the profession.

I’ve found that emphasis is put on ‘experience’ but there is a shortage of training available to younger people wanting to become advisers in small and mid-size firms.

Instead, many younger people go through the technical examinations and administration and paraplanning roles without the necessary client facing experiences.

FTA: When working with younger clients, how do you incorporate their age when giving financial advice? 

HT: Financial planning is about helping people reach their goals, someone aged 25 will have very different needs and priorities to someone aged 55 or 75.

Because younger clients have different goals and very different timeframes for things such as retirement and estate planning, we have to look at the advice process differently.

For example, while a cashflow model is a very useful tool for people in or nearing retirement, it is less useful for someone in their mid-twenties, looking at the next 70 years, so instead we view it as a ‘early warning system’.

Similarly, making pension contributions when you’re 25 is more about the immediate income tax savings than how much tax-free cash you could have when you’re 58 or the IHT saving at 74.

It is really about looking at what you can do now, that will help your future self, without impacting too much on your shorter-term goals.

FTA: How responsive are your younger clients to financial planning? How do you bridge the gap to make financial planning seem appealing to them?

HT: Generally speaking, younger clients are as responsive as older clients to financial planning. The key difference that I’ve found is that the preferred communication style and method is different.

For example, younger clients will generally respond better to emails, when they have free time from work / family, usually on weekends or later at night.

To get younger clients engaged, we provide free financial education pieces early on and build on financial literacy by providing topical insights, blogs and news pieces.