Gen Y presents a great opportunity for advisors, who need to better understand this generation that’s poised to become their clients and employees, said Peter Sheahan, best-selling Australian author of Generation Y: Thriving and Surviving With Generation Y At Work, and an authority on Gen Y.
First, advisors need to stop thinking that they were “just like [Gen Y] when I was young.” That’s not true. What’s the same is that your needs were similar, but the definition of needs today is different. “The social values of 40 years ago have changed today,” said Sheahan at the 2008 NAIFA Convention and Career Conference.
Advisors also need to stop having the attitude of “why bother [with Gen Y]?” Many advisors think Baby Boomers present a great sales opportunity. “There’s no doubt that Baby Boomers are a short-term, profitable target for you,” Sheahan said. “But the future value of a 25-year-old is more than that of a 55-year-old. You have an obligation to your association and business to sell to Gen Y, as it presents a real opportunity.”
Studies reveal that 20 percent of Gen Yers earn at least $120,000 per year, and 40 percent earn $75,000 per year. Fifty-five percent say their No. 1 concern is financial. “They represent a monetary opportunity and they need your expertise to help them,” Sheahan said. “Only 22 percent have life insurance, through someone else’s policy.”
How Gen Y is different
Here are three factors that will help you better understand Gen Yers and gain them as your clients and employees, according to Sheehan:
Gen Y expects things to happen fast. “These guys have never known the world of black-and-white TV that you were brought up in,” Sheahan said. Gen Y has been brought up in a world of “how do I get the result now with the least amount of effort.”
They want a fun environment to work in. Why do Gen Yers not move out of their parents’ homes? They say they can’t afford it. But they also stay at home because they actually like their families, Sheehan said. Why? Because parents are more collaborative with their Gen Y children than their own parents were with them. Gen Yers have been brought up in an environment where they feel they are being seen and heard, Sheahan said. They have also experienced the same spirit in schools where they are “made to feel special.” So when they seek employment, they are looking for the same collaborative, collegial and fun environment from the employer.
Twenty-four percent of Gen Yers say they want their parents to help them with financial planning. Forty-eight percent say their family is the most trusted source of advice for insurance needs.
This is a great opportunity for advisors, who all have mature clients with Gen Y children. All they need to do is “go to the parents and seek the kids, but treat them with respect,” Sheahan said. “Gen Y wants to be treated with the same level of respect as your other older clients. They want to feel respected. That’s their mindset.”
But you have to sell the benefits of your products differently to them. Position the benefit as short-term, not long-term. “Gen Y will take good today over the promise of a great tomorrow,” Sheahan said.