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Blog | Mar 26, 2024

4 Steps to Becoming the Multigenerational Investment Manager of Choice

multi-generational wealth management
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The investor community is continuing to expand, putting pressure on wealth and asset managers to meet the diverse needs of everyone from Gen Z to boomers. As demographics broaden, investment managers have never had to contend with such an extensive range of investor behaviors, preferences and complex continuity planning – across volatile markets and disruptive generations and technologies.

We live in a world accustomed to accessing information, goods and people faster than ever before. We all encounter personalized experiences; at every omnichannel interaction across industries we engage in targeted purchasing decisions. So why should financial services operate any differently?

In this blog, we delve into:

  • Why evolving demographics demand change.
  • Investor preferences and motivations.
  • 4 steps of actionable advice on exactly how to respond to this environment.

Find out how intelligent automation (IA) can set you up for success in both the short and long term to delight existing and new investors, and protect and accelerate assets under management (AUM) growth.

Time Is of the Essence

It’s time for wealth and asset managers to capitalize on the looming multigenerational transference of wealth and mitigate the risk of heirs and heiresses taking their newfound wealth elsewhere. The focus now isn’t only on retaining existing investors, but to prepare for the potential opportunity beyond those current relationships – and to affirm their position as the firm of choice for future generations.

Just 4% of millennials and Gen Z said they would leave all their assets with the same independent financial adviser (IFA).”

FT Adviser

Younger Generations Look to Switch Advisers for Inherited Wealth, FT Adviser

A new population of investors poses a significant opportunity. Excited at the prospect of investing their newfound wealth to help them achieve financial goals that may have been previously out of reach, they’re ready to engage with. Managers must shift gears on multiple fronts to retain existing investor relationships with proven traditional methods while evolving their model to keep up with new demands.

Get Future-Ready Today

Firms are tasked with delivering a complex matrix of tailored saving and investment opportunities spanning every communications channel built on the foundations of legacy technologies, expanding data sets and potentially siloed operations. And with private markets opening to offer the same retail investment opportunities as institutional and UHNW investors, wealth and asset managers are expected to deliver at scale to the growing mass affluent population.

Our unified AI-powered platform helps firms to reimagine work and deliver transformational results for investors with intelligence, orchestration and automation, surrounded by a best-practice operating model and comprehensive partner ecosystem. It connects your people, processes, data and technologies and helps you power and manage work end-to-end across your entire organization, all while continuously improving results. 

Organizations that have embraced digital transformation are seeing an increase in productivity (13.8%), assets under management (8.1%) and revenue (7.7%)."


Wealth and asset management 4.0, ThoughtLab

The Multigenerational Landscape

New breeds of investors have been emerging over the years with varying expectations. Conscientious millennials prefer human interactions but enjoy the freedom to self-serve while Gen Zs live in the digital fast lane, seeking advice from online influencers on which cryptocurrency to buy. Boomers remain risk averse and are the least likely to switch financial advisors while the most digitally savvy Gen Xers are looking to retire early or are busy saving for their children’s and grandchildren’s education.

Millennials are more than twice as likely (73%) than boomers (29%) to switch between providers, to move assets between firms or to begin working with new wealth managers.”


How Can Today’s Millennial Investor Drive Business Growth Tomorrow, EY

Although some generalizations can be made, every investor is unique. While it’s good to understand the varying degrees of risk investors are prepared to take, how they conduct research, what they expect in terms of financial advice and how they like to be communicated with, lumping people into different categories based on age alone and applying generational assumptions isn’t a robust enough starting point to mitigate risk.

The one thing every investor has in common today is that they share the same expectation of receiving tailored advice aligned with their specific financial planning strategy, goals and values via their preferred communication channel in a language they can easily understand.

For firms to put their best foot forward in navigating the shifting sands of this multigenerational landscape, it’s imperative to start developing and executing an intergenerational contingency strategy now.

What is an intergenerational contingency strategy?

Essentially, it’s a proactive approach to working with families to preserve their legacy by educating everyone to build on the success of their predecessors – AKA, multigenerational wealth. It’s a pivotal point in the investor relationship that could secure current and future investments by building long-term, sustainable relationships with stakeholders. Alternatively, failure to build these relationships could result in significant losses.

4 Steps to Future-Proof Your Firm

Follow these four simple steps to maximize the multigenerational opportunity and mitigate risk exposure. Integrating intelligent automation (IA) throughout this process will increase the likelihood of building deeper relationships with your investors and their successors by delivering personalized, consistent and effective financial advice across various channels to build intragenerational trust and meet every unique need.

Step 1: Size up the risk/opportunity

It’s important to have visibility of just how much of your business is at risk. You can start by auditing the following:

  • Clients by defined age groups
  • Assets under management for each group
  • Fees generated from each group
  • Assume 65% of this income leaves your business over the next decade

This will help you understand the potential financial risk you’re exposed to in the coming years. From here, you can develop a robust strategy and plan of action to turn your high-risk population into retention and growth opportunities.

Automate real-time insights with IA

Digital workers are programmed to replicate the exact work of a human. They excel at manual and repetitive tasks, removing the need for employees to endure tedious and error-prone data gathering, inputting and reporting. This frees up your employees' time to focus on strategic decision-making and fostering deeper investor relationships.

Digital workers operate 24/7 and can work continuously in the background to generate periodic reports. They deliver real-time insights with 100% accuracy and automatically distribute them to relevant stakeholders at the frequency of your choice. This enables wealth and asset managers to maintain constant insight to proactively manage the financial wellness and risk exposed to your firm. Wealth and asset managers can track how effectively their plan of action is performing, enabling them to continuously optimize, or pivot, to stay on the right path.

Step 2: Build unique investor profiles

Understand your existing investor motivations, behaviors and preferences. Ask the right questions to determine their financial aspirations and go beyond the standard level of risk they’re prepared to take when they entrust you with their hard-earned wealth and assets.

Get to know your investor base on a deeper level. Build out family stakeholder maps and assess the levels of engagement with each of these individuals to identify where you should focus your attention to build better relationships. Eliminate the risk of generational bias by creating unique personal profiles for every investor and their family members. Capture investment motivations and communication preferences and align every interaction with those.

Optimize your investor intelligence with IA

  • Identify missing data: Intelligent automation can assist with identifying gaps in investor profiles from the data in your customer relationship management system (CRM). Create fields to capture the breadth of the information you’re seeking. This allows you to build up a holistic picture of your investor's financial planning goals, family wealth plan and family trees. IA can then extract reports from your systems to highlight the areas requiring attention.
  • Proactively fill in the gaps: Once you’ve identified those gaps, IA can generate automated prompts in line with business rules. These prompts either notify the individuals managing those personal relationships to gather additional intel during their direct interactions, or they go directly to the investor with predetermined questions via their communications channel of choice. Additionally, digital workers can conduct external research to fill in any gaps from publicly accessible or third-party data sources.
  • Flag potential existing investor relationships: Digital workers can also conduct quick and accurate reconciliations of your data sets. They determine potential relationships from within your current investor base and flag them for investment managers to review and confirm.

Step 3: Align priorities with portfolios

With the knowledge of your investor's motivations, you can build a structure around portfolios and investment products to meet their financial goals. Maintaining quality interactions and proposing more meaningful investment opportunities to build deeper relationships with current investors is vital to delivering on your intergenerational contingency strategy.

Whether your investors’ financial drivers are around building an attractive retirement fund, estate planning, or saving for education, real estate or philanthropy, use this information to your advantage and create tailored investment solutions that specifically align with their unique motivations.

Streamline complexity at scale with IA

Intelligent automation combines several technologies that enable wealth and asset managers to orchestrate hybrid financial advice on one platform. Leveraging generative AI, machine learning (ML) and digital workers together enables you to simply connect the information you need to serve up bespoke financial advice aligned with each investor’s unique financial goals.

Gen AI can analyze vast amounts of data, including investors’ financial history, risk tolerance, investment preferences and market trends. It does this while incorporating investor behavior and sentiment by processing data from various sources, including social media, news and financial reports. It can generate personalized investment portfolio recommendations based on individual goals, optimizing for factors such as return on investment (ROI); environmental, social and governance (ESG) values; risk management; and liquidity requirements.

Automated systems can dynamically adjust portfolios based on changing market trends, ensuring investments remain aligned with the investor's goals and adapt to shifting financial landscapes. Using the combination of technologies provides advisors with a hybrid experience, allowing them to do more to discover evolving investor goals, have broader discussions and uncover more products. ​

Automation can generate and distribute customized reports on portfolio performance, investment strategies and market insights. Investors from older and younger generations can receive these reports through their preferred channels, allowing them to access relevant information aligned with their financial goals in their chosen format.

Step 4: Excel at omnichannel execution

You've collected the necessary data, know the investment solutions to propose and have insights into how your investors prefer to be communicated with. Now, you can share your tailored propositions via their chosen communications channel, or a combination of channels, at your investor’s desired frequency. This will kickstart your retention drive and protect the long-term health of your firm.

Tailor every touchpoint with Intelligent Automation

Leveraging IA can create a more cohesive, personalized and effective omnichannel communication strategy, ensuring the message resonates with unique investor needs and preferences. Firms can seamlessly integrate tailored messaging across multiple channels, ensuring that each investor receives information through their preferred medium.

Automation ensures messaging consistency regardless of preferred channels; it receives coherent and synchronized information, contributing to a seamless and unified experience. Firms can send instant updates and alerts across their preferred communication channels, ensuring investors stay informed about changes that may impact their investments.

Implementing chatbots and virtual assistants powered by IA allows wealth management firms to provide immediate responses to investor queries. These automated tools can address routine inquiries, guide investors through basic transactions and offer general information, freeing up human advisors to focus on more complex and strategic interactions.

What Next?

If firms fail to execute a successful intergenerational contingency strategy, they risk losing clients’ wealth, family assets and relationships – in addition to missing out on the potential for AUM growth new beneficiaries can bring in the future.

Leveraging IA technologies enables wealth and asset managers to build deeper relationships, protect assets and foster a greater level of trust with investors. Intelligent automation can be instrumental in securing firms’ immediate and long-term success, and ensure the investor benefits from a truly tailored experience, delivered with ease and at scale. This can help open the door to their family network and help all parties prepare for a better financial future.

Get in touch to let us help you become the multi-generational family investment manager of choice today.

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