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Shifting demographics: Understanding new wealth management client expectations


The wealth management industry, while historically slow to evolve, has undergone significant changes over the last few years. As the client base becomes accustomed to digital-first service experiences in other sectors, wealth management firms are being pressured to respond in kind. An industry once characterized by in-person meetings and one-on-one interactions is being forced to reevaluate how it carries out its business.

However, the advance of digitalization should not be confused with an aversion to personalized or human-led interactions to deliver a winning wealth management client experience. In fact, quite the opposite is true. While clients want more convenient access to their portfolios and advisors, this convenience cannot come at the expense of quality.

As demographics shift, there is a knock-on effect in terms of values and investment preferences, which firms must respond to in kind. The products and advice they offer need to be up to date, easy to access, and always compliant.

Given this context of changing service and product expectations, the firms that will stand out are those that achieve a sweet spot between digital channels and real financial advisor interaction. In short, the world is now hybrid and wealth management firms must embrace this reality to remain competitive to the modern wealth management client.

Shifting demographics: Who are firms serving in the wealth space?

It’s not just that client preferences are evolving – the clients themselves represent entirely new demographics.

The Great Wealth Transfer

Firstly, the Boomer generation is aging, and we are reaching the point where the majority of private wealth is soon going to pass to their children. The so-called “great wealth transfer” is currently underway and experts expect it will continue until around 2060, by which time around $60 trillion will move from older generations to younger ones.

Generational shifts are naturally to be expected, however this one in particular presents challenges due to the scale and attitude shift it represents. It used to be that firms could expect to inherit clients without much work, statistics reveal that 80% of millennials look to establish new relationships with advisors from other firms once their parents’ wealth passes into their hands. The reason for this appears largely to do with the digital and mobile experiences more innovative firms offer, which more closely match younger generations’ service expectations. Family firms, particularly more traditional ones, will find it difficult to retain these individuals unless they make substantial changes to their digital service and product offerings. There is simply no room for bad client experiences.

The rise of female investors

Both as part of the generational shifts taking place and due to a rise in female entrepreneurship, female investors represent a larger demographic than ever before. According to the Boston Consulting Group (BCG), women own 32% of global wealth and UBS’s Women’s Wealth 2030 predicts that this will reach a total of 97 trillion US dollars by 2024.

However, despite this sizable market share, PIMFA’s Shaping the Future of Digital Wealth Management claims that many of the products firms offer are targeted exclusively at men – representing a serious missed opportunity unless steps are taken.

Mainstream investors

Finally, traditional firms need to take a more active role in addressing the needs of mainstream investors, who are continuing to break down traditional barriers to investment. In the last five years alone, there have been a number of startups and asset manager websites moving into the emerging markets, concentrating primarily on mainstream investors. Traditional advisory services, which were historically closed to all except commercial entities or wealthy investors, are now incentivized to provide innovative investment strategies and solutions to broader audiences.

Service expectations among new demographics

Across the board, providing enhanced digital capabilities appears to be a service prerequisite for the incoming generation of wealth holders. When we look at millennial and Gen X investors, 34% and 35% respectively consider digital capabilities to be an important factor when choosing a wealth manager, as opposed to just 16% of those aged over 55.

However, simply providing new digital channels or self-service options is unlikely to produce the desired results. Customer preferences skew towards convenience and simplicity rather than innovation for innovation’s sake. Across all regions and demographics, a Refinitiv’s Wealth Management Report found that 57% of survey respondents prefer phone calls, 49% prefer in-person meetings, and 48% would choose email.

Traditional remote channels are undoubtedly alive and well – but they shouldn’t be considered a full service solution. An Ernst & Young report found that younger generations of wealth holders trust BigTech firms and would use Apple, Amazon, or Google as their primary investment firm if they offered financial management services.

What this tells us is that convenience is essential and digital service offerings should be implemented to enhance client-advisor interaction, not replace it. According to a UK survey as reported by Capgemini, 54% of investors aged between 18–25 lose faith in robo-advisors during periods of volatility and value the authentic help that a financial advisor can offer. Client-centricity is about delivering authentic human support in the most convenient and compliant manner possible and this is what firms must keep in mind if they hope to thrive.

At Unblu, we’ve seen this firsthand with one of our wealth advisory customers, who succeeded in upgrading their online interactions by leveraging digital technology to support individual client journeys. Previously, the firm had attempted to integrate various CX platforms and tools, with limited results due to the lack of continuity between the different tools. By implementing Unblu, the wealth advisory firm was able to offer a more cohesive customer experience that met expectations.

Embracing change: Delivering on new client expectations

Given this context, what steps should firms take to deliver a top wealth management client experience and maintain their position as industry leaders?

Ensure a simple experience with human interaction

Beginning with a strategic objective, firms should seek simplicity and use technology as a means of achieving it. For example, a Refinitiv’s Wealth Management Report found that 30% of respondents would like all of their investments to be viewable in one place, even if those investments are with different institutions. The report also found that 30% would like easier access to their products and services, 27% want direct digital access to their advisor, and 26% want to receive news based on their specific investments and holdings. What’s more, 64% of millennials and 51% of investors aged 35-54 even stated that they would pay more to receive these personalized investment products and services.

Leverage social media

For wealth management firms, there should be an increased strategic focus on social media as it will feature more heavily in investment contexts moving forward. In fact, 35% of millennials consider these platforms to be the most reliable source of investment advice. To put that into perspective, 38% claim that human advisors are the most important source. In response to this, many firms are investing in their social media presence, with 30% more firms planning to use it to source prospective clients by 2025 according to Accenture’s Wealth investments and advice in Europe.

Mobile wealth management apps as a prerequisite

We have reached the stage where wealth management websites are taking a backseat to mobile applications that offer insightful digital tools. According to the Refinitiv’s Wealth Management Report, while a total of 46% of investors say they use their mobile app to access their account information, if you only consider millennials the percentage of app users rises to 72% – 21% also using a digital watch or similar device. J.D. Power backs up these findings, claiming that Generation Y (which includes millennials) and Generation Z have an average satisfaction score of 760 and 720 respectively out of a 1,000 point scale (J.D. Power). Given the majority role that millennials will play in wealth management contexts, the importance of mobile cannot be understated.

These mobile wealth management apps should provide an extraordinary client experience that provides access to many financial tools. This could involve viewing their portfolio information, using trading tools, gaining real-time insights, tracking tax documentation, or other capabilities that contribute to a strong digital client experience.

Client experience: The critical component to ensure success

For any strategic initiative to come to fruition, whether offering more innovative products or leveraging the power of social media, the client service offering needs to be built on a foundation of positive experiences and exemplary customer service.

Achieving digital transformation requires a harmony of technology, human support, and stringent security and compliance best practices. The successful firms will be those that manage to deliver the full end-to-end wealth management experience that current and prospective clients expect, the rewards will be immense.