Alternative Investment

How Financial Advisors Can Attract Next Gen Investors


Spot on with popular beliefs, the next generation of investors have no problem choosing robo investment advisors when managing their money, however they also see value in human interactions in regard to how their financial advice is delivered. Vanguard surveyed 1,500 clients and found robo-advisors were preferred for tasks that could be automated whereas human advisors were the preference for activities requiring advice. The same study, given across several generations investors, uncovered similar results for financial advice. 


With this evidence in mind, if you are a financial advisor seeking to grow your business in 2022 and you are solely focused on uniquely human activities and advice, it puts you in the light as an emotional circuit breaker to your clients. As such, for any activity (such as administrative paperwork, portfolio rebalancing and scheduling) that can be perceived as non-valued by your clients, you are leveraging technology to complete those tasks or outsource them to other team members. Plus, given the fact that TikTok #financialadvice, #moneytok and #investing have amassed more than 15 billion views, financial advisors would be well-advised to pivot marketing techniques in order to reach the next generation investor and build trust among them. How? Developing a digital marketing presence is paramount.

How To Build A Digital Marketing Presence?

Given that nearly half of Gen Z uses TikTok as opposed to Google to gather information, building a digital marketing presence utilizing TikTok is crucial to attracting next generation investors. Adding to the significance of using TikTok to get the attention of next generation investors is the aforementioned TikTok investing hashtags which have an incredible 15 billion views. In order to garner their attention, your digital marketing strategy must be centered where Gen Z investors are looking—i.e. TikTok. Gen Z is drawn to those who are using video content to build trust and provide sound financial information and advice. Financial advisors who aren’t building their digital marketing presence with TikTok as a major part may quickly find themselves bringing up the rear in the attraction of next generation investors. Having a solid opinion and sound advice that you state clearly to showcase your beliefs and ideas resonates with a lot of people, rather than turning them off. Why? It demonstrates what you stand for and the fact that you are not afraid to think outside the box. 

Track, Measure And Improve

You may have heard the quote, “If you can’t track it, it doesn’t count.” If you can’t measure what you are doing in some meaningful way, not only is the value of your effort diminished, but you also have no way to make improvements to your digital marketing plan or presence. Utilizing trackable links as opposed to PDFs allow you, as a financial advisor, to see exactly who is taking the time to look at the material you are producing on various platforms, as well as how long they look. Trackable links are measurable, they can be counted, and improved upon rather than simply assuming people are looking at your content. Studies show people don’t want to read lengthy white pages, they want shorter, more concise information and insights from trusted, reputable financial professionals. They want the information summed up—the key is to write less, but say more with your content. 

The Human Connection

Next generation investors prefer human advisors when it comes to financial advice but robo-advisors for tasks that are easily automated. In a survey by the Harris Poll for NerdWallet, 84% of those interviewed said they would rather work with a human financial advisor when investing their money compared with 16% who preferred a robo for investing. Investors want human interaction for investments, financial advice, legacy and tax planning, and any area that requires trust and a stronger connection. Robo-advisors are preferred for administrative tasks like investment selection, signatures, scheduling and portfolio rebalancing. Individual investors still feel the human connection is best because only then can their individual situations be truly understood and considered. 

Other Ways To Attract Next Generation Investors

When seeking to attract the next generation of investors, it is important to understand they are seeking not only transparency but sophisticated technology. You, as a financial advisor, need to be the emotional circuit breaker for a generation (Z) who grew up with cryptocurrency, its exponential rises and crashes, as well as the global pandemic in which stocks hit a bear market and spiked back up again. The new generation of investors is used to volatility, so you must build trust to set the proper expectations. As a human financial advisor you have the unique opportunity to connect with them and help them understand the key to financial investment success is “about time in the market versus timing the market.”

Devon Drew, Forbes Council Member, is the founder of DFD Partners, successful former executive for Vanguard Group, Certified Investment Management Analyst, Chartered Retirement Planning Counselor and Chartered Alternative Investment Analyst candidate.

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