Secure the generational wealth transfer
It’s no secret we are currently witnessing the greatest wealth transfer in history. It’s also no secret
preventing assets from walking out the door is one of the toughest parts of being a financial
advisor. What makes it so hard?
In most families, talking about money is taboo. Many families will put the conversation off until
something urgent takes place, and they have no choice. With emotions running high and the
family in a situation that already feels precarious, these last-minute conversations can lead to rash
decisions, which result in avoidable tension or even the loss of wealth.
Only about 30% of wealth transfer plans are successful.1 Why do so many fail? Trust and
communication issues are the primary causes, both among family members and between family
members and their advisor.1 To improve the success rate of wealth transfers, advisors must realize
it’s not just about protecting the actual assets, but about preparing the heirs receiving the assets.
As a financial advisor, you play an invaluable role in helping families have open dialogues about
money. Advisors who understand multigenerational dynamics and can initiate discussions can
have an advantage in the marketplace.
Here are some tips to help you simplify intergenerational financial conversations and
ease the tension amid families:
Uncover each person’s concerns
Begin by having individual meetings with
grandparents, parents and children to uncover
their unique concerns. These conversations
can help you understand concerns from every
generation’s viewpoint. For example, your
Traditionalist may be most worried about preserving
family values. Baby Boomers might be concerned
about how they will maintain their independence
as they age. Gen Xers could be troubled if they don’t
have a clear picture of what is going on financially
in their family. And Millennial and Generation Z
heirs may be worried about keeping up with the
financial jargon at the meeting. Taking time to make
connections and learn about each person’s concerns
will help your clients and will strengthen your
relationship with each heir.
Explore individual goals
Your role as an advisor goes beyond uncovering and
addressing concerns but also requires examining
each person’s goals and objectives. Without
understanding everyone’s different needs, a
successful wealth transfer cannot happen. Perhaps
Traditionalist grandparents would like to share their
life lessons, stories and values with their children and
grandchildren. Baby Boomers may have lofty visions
of what retirement will look like or may want to start
an encore career. Xers may have a dream of sending
their kids to college debt-free. Millennials might be
exploring options for a trip abroad, donating to a
philanthropic cause or saving to purchase a home.
Uncovering the goals of each generation will help
you focus on both individual and shared priorities,
so every family member feels valued and invested in
the plan at large. After all, assisting clients to reach
personal goals is arguably one of the best parts of
being a financial advisor.
Be their generational translator
So how do you carefully bring both the concerns
and goals of each person to the table? There are two
things to keep in mind here: the structure of the
meeting itself and the perspective of each generation.
When considering the structure of the meeting, keep
in mind that each generation will most likely have
different expectations. For example, Traditionalists
and Boomers will want some structure and would
benefit from an agenda ahead of time. Xers may wish
to ask questions, to you or their family members, and
Millennials will want this to feel like a collaborative
process. While not easy, it is possible to address all
of these generational desires at the same meeting.
Generational perspectives may, however, provide
some angst to the conversation. Beyond the
structure of the meeting, you may need to
moderate as communication can break down
along generation lines, especially when it comes to
priorities and perspectives. Do Traditionalists feel
like a valued part of the conversation and not put out
to pasture? Are your Boomer clients worried their
Millennial heirs don’t understand what’s at stake?
Are the Xers focusing on the worst-case scenarios
and deflating the others in the room?
Start these conversations by saying something
like, “After meeting with each of you, here’s what
I have learned….” Then use your generational
know-how to keep the conversation moving.
Although the family conversations can be labor-intensive, advisors have an excellent opportunity
to fill a need for their clients and forge lasting relationships with the next generation of investors.
Getting each generation involved in discussions about money can create stronger families,
more responsible financial planning, and can improve your ability to secure generational
1The Williams Group. (2015).
This information was prepared in part by an unrelated independent third party, BridgeWorks, and is provided for informational purposes only. Ivy Distributors, Inc.,
believes the information has been obtained from sources considered to be reliable, but does not guarantee the accuracy of the information provided.