How to retain the next generation of clients

Many advisers have traditionally focused on older age cohorts, yet with 38 per cent of Australians expecting to inherit within the next decade, the opportunity to engage younger generations has never been more pressing. This younger segment seeks a different approach in their interactions with service providers, including advisers, necessitating a shift in engagement strategies and service delivery.

New research from Colonial First State (CFS) shows that while younger generations may be banking on help from mum and dad to get ahead, older generations are facing their own challenges with retirement planning. Most people want to leave something behind for the next generation, but those desires must be balanced with the retirement realities of an income beyond the age of 67 and potential Aged Care costs down the track.

This is a topic that impacts every Australian family. And while these issues necessitate intergenerational advice, research suggests some resistance from the next generation. Only 23 per cent of adult children say they would continue working with their parents’ adviser after receiving an inheritance – despite 64 per cent saying they’re likely to seek advice from that adviser if trust and relevance are established.

Pleasingly, 68 per cent of those same adult children said they’d be willing to attend a meeting with their parents’ adviser. This tells us that while trust may not yet be established, the door is open. The next generation is willing to engage, provided we meet them where they are.

Trust is the first hurdle

Fewer than half of adult children trust their parents’ adviser, and those without an adviser themselves are twice as likely to distrust the benefactor’s adviser, highlighting the need for proactive engagement and transparency.

To build that trust, advisers need to shift from being seen as the person working with one’s parents to the professional who can meet one’s own needs. That means listening deeply, understanding their goals, and showing genuine interest in their lives and not just their finances.

Advice that feels relevant

Younger Australians want advice. Our latest Empowered Australian report found that while affordability remains a key barrier, the demand for advice is strong, particularly among those aged 30 to 49. Our research found that 77 per cent of Australians in their 40s would like to see advice priced according to their needs, from simple to complex. This is where advisers can truly differentiate themselves. By offering education and empowerment (not just transactions), advice practices can position themselves as lifelong partners to the children and grandchildren of their current clients.

Make it seamless and tech-savvy

Young people expect digital-first experiences, and with only 27 per cent of those who’ve inherited currently advised, a modern, tech-enabled approach could be the differentiator that brings them onboard.

Investing in technology is about credibility. A smooth, tech-enabled experience signals that you understand how they live and work.

So how do you actually build connections with the children of your current clients?

1. Facilitate intergenerational conversations

Only 45 per cent of those expecting an inheritance feel knowledgeable about their benefactor’s financial situation, making these conversations not just helpful but essential.

2. Show the value of your advice

Many Australians use investments and property to achieve goals while alive, not necessarily to pass on. Over a third of investment holders don’t plan to include them in their will. Advisers can help clarify and align these strategies.

3. Use super and insurance entry points

Super is often the first significant financial asset younger Australians engage with. Use it as a conversation starter. Help them understand the power of compounding, the importance of early contributions, and how their choices today shape their future. It’s a natural way to introduce broader financial planning concepts.

The opportunity for advisers is to build the relationships before an inheritance happens. Advisers who wait until the inheritance lands may find themselves too late.

This is about more than retention. It’s about relevance. It’s about showing that financial advice isn’t just for the wealthy or the retired, but for anyone who wants to make smart decisions and build a better future.

Jackie Clark, director of education, engagement and events, CFS