In a report titled The truth about Gen X and Gen Y, ING Direct found that contrary to common assumptions, Gen Y prefer face-to-face advice over robo-advice.
ING Direct head of third party distribution Mark Woolnough said, “It’s refreshing to see that the more digitally-savvy younger Australians recognise the value of face-to-face financial advice.”
“This shows that while there is a place for online solutions, they should complement personal advice relationships and not be at their expense.”
Mr Woolnough noted that the net wealth of Gen X and Gen Y sits at approximately $1.4 trillion.
“Coupled with an intergenerational wealth transfer of $2.4 trillion occurring during the next three decades, that’s a huge opportunity for advisers,” he said.
The report found that a key factor stopping Gen Y from seeking financial advice is the perception of high fees. Only 5 per cent of Gen X and Gen Y have an adviser, the study said.
According to the report, both generations expect to pay a maximum of $250 for comprehensive face-to-face advice.
The majority of Gen Y, however, expect robo-advice to be free.
Read this ASIC and others? $250 is what they think it should cost. That would be fair if we didn’t have to do a massive SOA full of crap. Why can’t all the brains trust create an industry template advice document that is prepared online free of superfluous generic fluff. They want personal advice they can afford to pay, not a robot or a 50 page SOA. It’s out of control. We’re on the endangered list thanks to the current oxygen bandits in management.
I don’t think there is anything new here…surveys have shown that GenY want a “Financial Coach” but aren’t willing to pay for “Financial Advice” (read Superannuation Investment advice). The reason they nominate $250 as the maximum they are willing to pay, is because the ‘old model’ of fund management and super comparisons isn’t valuable to them. If you offer them what they really want – Goal planning, savings & debt strategies etc – they will pay fees north of $2000.
Finally whilst they want “face to face” – this doesn’t mean “in person” – we currently run about 90% of our client meetings either through GoToMeeting or by pre-recorded video updates. What they want in personal meetings delivered using a medium that suits them.