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Millennials and financial advisors: what can wealth managers learn from growing disruptive competition


Struggling under the burden of student debt, a dramatic decline in homeownership, and the gig economy where wages are often unstable, Millennials need financial advice more than anyone. But younger consumers want financial advice to be delivered differently. They’re drawn towards interactive tools and innovative mobile apps, and guidance in the form of “quick tips”. In fact, 67% of Millennials say they prefer robo advisory services compared to just 30% of Generation X and Babyboomer consumers.

While traditional providers are slowly adopting new online solutions, other companies are disrupting the advisory model with a hybrid customer experience that combines both digital and human communication channels. These companies are often targeting Millennials in particular, and represent fierce competition for those providers that have so far failed to overcome this generational misunderstanding.

By examining the value proposition of these disruptive competitors, wealth managers can learn what it is that Millennials want and how to better serve this younger generation.

Price matters

These new financial service providers understand the value of affordability for Millennials. Take Robinhood, for example, an investing app, whose zero-commission model is appreciated by this money-conscious generation, who are attracted towards services that keep prices low. As a result, more and more companies are cutting their fees. In fact, all-in fees for robo advice are typically less than 1% and, in 2019, Charles Schwab, E*Trade, Fidelity and TD Ameritrade also reduced their commissions to zero.

Investments with impact

Millennials are more concerned about the environmental or social impact of investments. In fact, according to Morgan Stanley, under-35s are twice as likely as others to sell a holding if they consider a company’s behavior to be environmentally or socially unsustainable. Hence why Nutmeg, an online investment management platform, is now providing investors with environmental, social, and governance social scores for its ready-made portfolios.


Younger consumers are increasingly drawn to digital services. According to BlackRock, 4 out of 5 Millennials who are aware of robo-advisers are keen to use them. These “robots” are essentially algorithms that give basic investment advice based on the customer’s investment time horizon and feelings about risk. This robo-advisory model—as offered by platforms such as Nutmeg, Moneyfarm, and Moneybox—is very different from the 100% personalized financial advice offered by independent financial advisers.

Fun and engaging

Up until now, there has been an informational imbalance between clients and advisors. Financial advice has been so complex that consumers have to pay to have it explained to them. Millennials want financial advice—but they want a more compelling delivery. Today’s new financial players understand this. Now Millennials can get to grips with complicated financial information in an easy and fun way using mobile apps and interactive financial tools that bring a game-like element to financial guidance.

Make it personal

Millennials are also put off by the one-size-fits-all approach to financial advice. New and disruptive providers are offering more personalized services, tailored to each individual consumer while still keeping prices low. Nutmeg, for example, offers a 15-minute phone call for £350. And some robo-advice players such as Betterment offer a tiered model whereby consumers can choose between a digital-only service or a service augmented by human help. While Millennials appreciate digital tools, they also seek the reassurance that only a human advisor can offer.

Wealth transfers between generations typically result in 90% of “heirs” changing financial advisors. Given that Millennials’ inheritance from Baby Boomers will constitute the largest wealth transfer in history, financial providers need to get ready. They need to build a value proposition that truly engages this younger generation, adapting their services in order to stay ahead of the competition.

Financial advice & Unblu

Unblu’s platform of products combines the best of human and digital, allowing providers to create a customer experience that is flexible, personal, and engaging, resulting in cost savings for both client and company. Find out more by booking a demo today and one of the Unblu team members will be in contact.