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Intelligent Advisor

Millennials to FinServ: We're Loyal and Trusting

If financial services firms and advisors can attract millennials early, new research shows they will remain loyal clients.

In a study of over 1,000 wealthy millennials (aged 18-34) with more than $100,000 in investable assets (excluding real estate), LinkedIn found that almost half said they’re very loyal and plan to do more business in the future with their chosen financial institutions.

“Millennials grew up in the ‘80s and ‘90s, during an age where we were marketing to these kids, so they’re really connected to brands their whole lives and have a certain level of trust,” says Menaka Thillaiampalam, head of financial services marketing for LinkedIn.

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Specifically, about 47 percent of affluent millennials say they are very loyal to their financial firm, compared to only 27 percent of affluent Gen-Xers (aged 35-49). Moreover, about 64 percent of affluent millenials say they trust the financial institution they're working with, compared to 52 percent of wealthy Gen-Xers. Most millennials, unlike Gen-Xers and baby boomers, did not have a sizable portion of their assets invested during the dot-com bubble in early 2000 or the 2008 financial crisis. 

And even though millennials tend to do their own research and seek out information on potential firms, they are seeking advice. About 37 percent cited financial advisors as a “must-have,” compared to 27 percent of affluent Gen-Xers.

Gaining millennials as clients not only provides stability, Thillaiampalam says it’s a profitable business strategy. Millennials are expected to be on the receiving end of a $59 trillion wealth transfer over the next few years, and only about half of the affluent have a brokerage account and only 25 percent of the emerging wealthy (those with between $25,000 and $100,000 in investable assets) do. 

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“This is a really disruptive, but powerful generation that financial institutions really need to provide relevant, personal solutions through the social networks that these Millennials are leveraging today,” Thillaiampalam says. 

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