Generation X a Key Target for Advisers

Generation X offers key opportunities for advisers, according to “Moving the Needle: Targeting Generation X,” commissioned by Jefferson National, the advisory solutions business of Nationwide. The report is aimed at helping advisers and registered investment advisers (RIAs) better understand Gen X’s priorities, preference and concerns, so they can grow their business.

“Being in their prime earning years and next in line for inheritance, Gen X is a vital segment for advisers to target in order to enhance profitability and set their firms up for future success,” says Craig Hawley, head of Nationwide’s advisory solutions business. “Each year, successful advisers are most likely to say that Gen X will be their primary target over the next 12 months.” In fact, Jefferson National says these investors are poised to inherit $30 trillion.

Jefferson National also says that the number of affluent Gen X investors now exceeds the number of affluent Baby Boomers. Citing a study by Deloitte, the firm says that by 2030, Gen X investor’s assets will reach $22 trillion, while Millennials’ share will be $11 trillion.

The study found that 52% of Gen X do not have an adviser. As the Jefferson National report says, “as this generation continues to earn more and inherit more wealth, there is huge opportunity for advisers to tap into this market.”

Among those Gen X’ers who are working with an adviser, 30% say it is because they are concerned about saving enough for retirement. For Millenials working with an adviser, the primary motivation is to feel confident about their financial future, cited by 27%.

When selecting an adviser, Gen X investors  say experience matters most (41%). Twenty-six percent want personalized advice for a holistic financial picture, and 20% say a fee-based fiduciary standard is important.

Among all members of Gen X, including those not working with an adviser, when asked about their top financial concerns, 46% say it is saving enough for retirement, 28% say it is the cost of health care, 21% say it is financing their children’s education, and 20% say it is protecting assets.

Thirty-three percent of Gen X prefers face-to-face meetings over all other forms of communication. Likewise, Jefferson National says this is the best way for advisers to learn about Gen X investors’ needs.

The firm also found that 26% of Gen X investors say the quality of communication makes for a successful customer experience, followed by low-cost products and services (22%) and establishing a personal relationship with their adviser (14%).

Jefferson National’s report on Gen X can be downloaded here.