It’s easy to pigeon-hole the millennial generation into a digital box where every human interaction, every question and every answer or solution is transacted via a screen. As it relates to the world of financial planning, putting this cohort into that box would be a big mistake. New research conducted by The Guardian Life Insurance Company of America® (Guardian) reveals a more complex view of millennials as it relates to financial planning habits and preferences, potentially debunking certain myths, and revealing a generation more like their predecessors than some would have imagined.
The study, Millennials and Money: Understanding What Drives Financial Confidence, reveals that millennials are open to learning about financial strategies more so than predicted, as nearly 75 percent say they would attend an in-person financial seminar, compared to 69 percent of generation X and 62 percent of baby boomers.
What’s more, 87 percent of millennials say knowing more about financial services and products would contribute to improving their confidence in reaching their financial goals, and nearly 100 percent of millennials who report they have a financial plan and are on track to meet their financial goals say knowing more about financial products and services would help their confidence.
A Generation Receptive to Advice
This generation is not only open to learning about financial services, but they also emphasize the importance of working with financial advisors. Millennials are more likely than any other generation to say that having a financial advisor they trust is important to their financial confidence (83 percent). In fact, they seek expert input on both offensive and defensive financial tactics; while millennials are interested in talking to their advisors about investments and growth, they prioritize protection planning, as they are equally as concerned with protecting themselves and their families with insurance as generation X and baby boomers—even if it means putting off saving and investing for short term gains. Furthermore, more than three-fourths (76 percent) of millennials say it’s important that their financial advisor stay on top of the latest protection and insurance trends.
“We’re seeing a willingness among millennials to increase their financial acumen and work with advisors, to grow and protect their wealth,” said Christopher Dyrhaug, Head of Individual Markets at Guardian. “Millennials value education and have a preference to learn in a group setting. While technology may be a facilitator, there is still an appetite for in-person learning and engagement to reach financial confidence.”
When it comes to keeping in touch with their financial advisors, millennials (45 percent) are more interested in having face-to-face meetings with an advisor than other generations (37 percent), and surprisingly, texting and social media trail far behind. Compared to other generations, millennials also lean heavily on using online financial tools, with 35 percent saying they exclusively use online tools for financial planning, compared to 27 percent of generation Xers and 21 percent of baby boomers.
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Overall, millennials see financial advisors as a source of sound financial advice and as a partner who can help them achieve their short and long-term financial objectives. In fact, one in three millennials who don’t utilize a financial advisor say they are likely to begin using one in the next year, making them the most likely group to begin engaging with a financial advisor compared to unadvised workers in other generations.
Value in Thoughtful Financial Planning
Though often perceived as a generation looking for instant-gratification, millennials understand the value of careful financial planning. Nearly 90 percent of millennials say having a detailed financial plan that spells out exactly how they’ll meet their financial objectives would improve their confidence in achieving those objectives. When it comes to overall financial confidence, millennials say having a detailed financial plan is equally as important to them as getting a raise. More than half (62 percent) of millennials also say that getting financial advice from their employer would increase their financial confidence. However, across all major priorities, millennials show less confidence in achieving their objectives than other generations, leaving much room for improvement, and for guidance, from a professional partner.
“Our data shows millennials really do value financial planning, just as much, if not more, than a bonus at work and other life priorities, like career growth,” said Dyrhaug. “That provides a revealing look into their mindset as related to financial confidence and how advisors can provide guidance.”
For more information about Guardian or to view a copy of the study, please visit https://www.guardianlife.com/insights-and-resources.