Many financial advisers are pursuing a once-overlooked market segment, which includes early-career professionals who welcome expert advice on budgeting, financial planning and basic investment management, even though they haven't amassed much wealth.
To attract these up and comers, many of them in their late 20 s and early 30 s, advisers are expanding their services. Just saying to help young people invest wisely and plan for retirement may not be enough. They position themselves as life coaches and business consultants.
Nate Baim, a certified financial planner in Portland, Ore, said that clients should plan their life pursuits, the critical items that they need to increase their confidence in achieving their most valued goals and aspirations. He works with young professionals not only on traditional financial planning but also on budgeting, student loan repayment and career benchmarking.
Baim said that they use cash flow tracking technology to help them understand how much they are saving and spending. We look into their loans and repayment options with student loan repayment analysis. We help them find ways to optimize their career trajectory if their current pay is competitive and how to negotiate pay. Baim was consulting a couple in their late 30s and learned that they wanted to diversify their income by adding a side gig to their day jobs. He suggested that they could seek more flexible hours for their current employment and scrutinize their plans for additional work.
Like a business strategist, Baim urged them to pinpoint their value proposition and devise ways to harness each other's skills, so they could maximize their self-employed income while maintaining their primary income.
Rachel Lawrence, a certified financial planner in Rochester, N.H., uses a flat fee to attract a younger demographic. She charges a percentage of assets under management only for a few clients with more substantial wealth, and offers tiers of service at different price points.
Early-career professionals who tend to have limited assets can be appealed to by flat-fee pricing. Their priorities may be debt management or buying their first home rather than picking stocks.
Many advisers address the broad concerns with specific coaching that encourages younger clients to reach new heights in every aspect of their life.
Lawrence has a longtime passion for personal growth. She gives clients access to a pre-qualified list of consultants, including life coaches and nutrition experts, for a set number of sessions.
She said there is a correlation between physical wellness and financial wellness. My friend has a trust administered by his family's long-time financial adviser, but he is questioning his financial adviser's motives. My husband is only in his second year of establishing credit. He has a little money he d like to grow, but will a financial adviser take on a case like his?