Unlocking the potential of the millennial demographic in the UK presents a compelling opportunity for financial advisers.
The demographic landscape is shifting, with Millennials (those born between 1981 and 1996) emerging as a formidable force.
According to the Office for National Statistics there are 16.8mn in the UK, making up around 25 per cent of the UK population, and by 2025 they are poised to dominate the workforce, comprising a staggering 75 per cent.
Following the UK recession in 2008, Millennials have forged new enterprises, fundamentally altering the career aspirations of an entire generation.
A growing number of Britons are embracing freelance work, with reports showing approximately one-sixth of the UK workforce is now self-employed.
This shift marks a significant departure from traditional employment patterns and represents the most substantial change in Western society in over a century.
Additionally, according to a report by the Resolution Foundation, over the next 30 years a significant intergenerational wealth transfer is on the horizon, with millennials poised to inherit a substantial £1.2tn from preceding generations.
All this data presents a huge opportunity and unique opening for financial advisers to manage assets and provide comprehensive wealth management services, setting the stage for enduring client relationships and sustained revenue streams.
Engaging millennials early in their financial journey lays the foundation for enduring client relationships.
As many millennials just turned 40, or are approaching 40 and navigating pivotal life stages such as homeownership, growing families, and retirement planning, they will increasingly seek ongoing financial guidance.
Building trust and rapport with this generation now can lead to lasting client relationships yielding substantial benefits for financial advisers, but to succeed in expanding this demographic, advisers must consider the distinctive needs of this generation.
Sustainable investing
In the UK, ethical and socially responsible investing continues to gain traction among millennials, they are in fact, the generation most likely to invest ethically, with 14 per cent having already been involved in ESG investing, according to a study from Finder.
With a heightened awareness of environmental and social issues, many Millennials are actively seeking investment opportunities that align with their values.
Financial advisers play a crucial role in introducing them to ethical investment options and sustainable funds, from renewable energy projects to socially responsible companies.
According to a report from the House of Commons committee, ESG assets under management are projected to reach US$34tn (£27tn) by 2026, marking a significant rise from 14 per cent to 21 per cent of all Aum since 2021.
This presents a plethora of opportunities for advisers to help Millennials invest with purpose while also achieving financial growth.
Digital financial literacy
Millennials are synonymous with technological adeptness. According to a study by the Money and Pensions Service, 80 per cent of UK Millennials use mobile banking apps to manage their finances, highlighting their proficiency with digital tools.
Similarly, research from Finder UK found that 57 per cent of UK Millennials used budgeting apps to monitor their spending and manage their finances more effectively.
