blog from moneyinfo

Seizing the opportunities presented by wealth transfer

Share this resource
company

Beautiful client portals for wealth management

View Solution Provider Profile

solution

moneyinfo wealth

Imagine being able to give your clients the ability to access all of their financial data, on the move, 24/7... The freedom this would give them, and how this could revolutionise your relationship with them. Not only will they be able to access their investments and pension and general savings portfolios,...

view solution
by moneyinfo
| 21/08/2019 12:00:00

aaa email header image Child Hand

Why you can’t afford not to build a relationship with your next generation of clients.
Your clients are getting older. 56% of adviser clients are aged 55 or over with nearly a third over 65. [1]

The next generation of your clients will be millennials. They are aged between 25-45 now and they’re expected to inherit £1.2 trillion over the next 30 years, representing five million potential ‘advice’ customers with an average inheritance of £233,000. [2]

In a new white paper on intergenerational advice, which we’d urge every adviser to read, Brooks Macdonald have analysed HNW inheritance potential over just the next ten years. [3]

  • 770 UHNW families are expected to pass on their wealth in the next 10 years to 6,000 inheritors at an average of £34m each and
  • 36,000 HNW individuals are expected to transfer £127bn to 283,000 inheritors at an average of £500k per inheritor.

These numbers are huge. As pointed out in the report, the £337bn potential HNW inheritances over the next ten years will exceed the total UK advice market, which currently has £274bn assets under administration. [4]

The paper highlights wealth transfer as a growing threat to UK adviser firms and this is backed up by reports in the US that state that two-thirds of inheritors say they will fire their parent’s adviser when they inherit! [5]. But for adviser firms who get their act together, it is also a great opportunity as many of these new inheritors will not have enough assets for the private banks and wealth management firms that have looked after their parents.

Social media for good or bad …
Through their social media networks, the children of your clients could be your best advocates in attracting these new inheritors as they will naturally share a job well done with their friends. For good or bad, depending on your relationship, their network will connect you to these new inheritors.

With that in mind, what can you do now to ensure the ‘millennial’ children of your clients not only remain your clients when the wealth passes to them but become advocates for you in the hunt for new assets?

It’s going to be expensive to offer face-to-face advice to the next generation - and they may not need it right now – but creative use of digital technology can help you to cost-effectively build a relationship.

It must be mobile.
The technology you provide your clients’ children should help them manage their finances, though of course for them to use it, it must be available as an app for their smartphone. Extend your existing app to your clients’ children so they can -

  1. Track their investments, savings and pensions.
  2. Track their property and related insurances.
  3. Track their income and spending.
  4. Manage their debt (mortgage, student loan, credit cards etc)
  5. Store all the paperwork so they can find it easily, especially in an emergency.
  6. Remind them when they need to do things such as policy renewals, car MOT etc.
  7. Nudge them into making better financial decisions.

Your future clients will appreciate being able to monitor their savings, pensions, investments, personal finances, property, insurances and debt together in one place and will also benefit from any relevant news that helps promote good savings habits.

They will love having one easy place to store all their financial paperwork knowing it is secure and accessible when they need it and your app can provide them with a secure method to communicate with you so that if they have any questions or concerns you can be a first port of call. You will be there to help them in the moments that matter.

Reinforcing your existing relationship.
By using technology with the next generation, you are reinforcing your relationship with your current clients. Subject to agreement to share data, you can provide views across the whole family bringing together client, partner, trusts, dependents and business accounts. And for estate planning, the net worth statements will combine to provide a family balance sheet to identify potential IHT liability and helping you to propose solutions to reduce the liability including transfers and life assurance.

Work with your current clients to create an ‘in case of emergency’ (ICE) folder in which to store everything of relevance including copies of wills, trust deeds and lasting powers of attorney together with all the relevant paperwork for insurances, property deeds etc. This means that should the worst happen, you can provide the family with all the information and paperwork to calculate the estate, supporting the executor and speeding-up the process of probate.

In summary.
If you’ve helped their children with early stage financial advice when they need it for property, savings, pensions, insurance and debt, helped their parents to estate plan and made the process of probate easier then I’d suggest you’re well on your way not just to securing the succession of your current assets but through recommendation and social networking, access to a huge new potential client base.

On the other hand, you can just do nothing and hope that your clients live longer than you!


Our standard setup fee is £5,000 upfront for the core IFA product, while the DFM and wealth management upfront cost is £20,000. This includes full app (Apple & Android) and desktop white-labelling, training, data feed setup and management, and adoption support from a dedicated implementation consultant.

To find out more book a  1-2-1 meeting , or call us on 03303 600 300. We’d love to hear from you.


[1] https://www.aegon.co.uk/content/dam/ukpaw/documents/aegon-adviser-attitudes-report-a-spotlight-on-advisers-clients.pdf

[2] 5.1m millennials in the UK to inherit an average of £233,000 i.e. £1.188trn over the next 30 years

https://www.sanlam.co.uk/getmedia/26732f95-d494-422a-8892-3bc905fa959f/Sanlam-%E2%80%93-The-generation-game.pdfc

[3] BM-Intergen-Wealth-Report-2019.pdf available from https://www.brooksmacdonald.com/

[4] PIMFA: The Financial Adviser Market in Numbers, 2017

[5] https://www.investmentnews.com/article/20150713/FEATURE/150719999/the-great-wealth-transfer-is-coming-putting-advisers-at-risk

See original blog: https://www.moneyinfo.com/news/Seizingtheopportunities