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Millennials and Gen X Are Reshaping the Industry

Are you geared to attract the best available talent?

By Paul Forlenza

With four generations active in the workforce, each with varying degrees of earning capacity and wealth transfer, these multigenerations are reshaping the industry and presenting unprecedented opportunities for financial advisors. Everywhere you look, financial service organizations are targeting the business leaders of the future by focusing on millennials. These are people born between 1985 and 2004. However, Generation X, born between 1965 and 1984, is poised for larger growth in assets than any other generation and is also expected to receive more wealth transfer.

As leaders and managers of financial advisory firms, what are you doing to attract and retain the best talent in these two demographic sectors? How are you structuring 401(k) and benefits packages to align with their interests, financial goals and lifestyles?

The competition for talent in financial services is both real and relentless. The unemployment rate for the sector is 2.4%, compared with 3.7% for the overall national average (as of September 2018) and by 2022, the U.S. wealth management industry is likely to face a shortfall of at least 200,000 advisors. Currently, the largest active cohort of advisors are aged between 50 and 59, and the industry as a whole is aging. Small companies are in direct competition for talent with larger firms. One of the most effective ways to attract quality talent into your organization is by offering competitive benefits and 401(k) plans with offerings that are customized and tailored to the unique needs and interests of each generation.

Each Generation Values Different Things

Research by Barclays found that six out of 10 employees said that a comprehensive benefits package is essential when considering a job offer. Yet 85% felt their current benefits packages failed to provide the support and flexibility they need.

Get X, in particular, is worthy of your attention. The members of this group make up the backbone of many current workforces and are skilled, experienced and typically have 25 years or more until retirement. These are a company’s senior leadership hires and this talent is more impactful and also more difficult to find. In addition, millennials will be the future leaders of your organization, so despite most of them lacking your current asset minimums at present, they also warrant your attention.

With the intent of providing context and not getting too carried away with stereotypes, the majority of Gen X employees are married with children, have mortgages and aging parents. Millennials are typically single, paying off student debt and perhaps exploring their first house purchase. When it comes to benefits, here’s how their interests differ:

Gen Xers wantMillennials want: Family health coveragePaid time offFlexible work arrangements, generous family leave policies, and creative time-off programs to meet the dual needs of child and elder care responsibilitiesA great deal of flexibility, ability to work remotely and control over their schedulesCareer advancement opportunitiesPersonal development opportunitiesA health savings account (HSA) they can roll over year to year and help with health-related costs in retirementWorkplace perks like wind-down or nap rooms, relaxation opportunities and massagesAncillary benefits such as free legal consultations, representation in court, and creation of a will or trustCapped and matched student loan debt contributionsLong-term care insuranceHealth-oriented benefits such as discounted gym memberships or plans that reward for wellnessRicher premiums as they are making more money and can afford higher paycheck-to-paycheck deductionsA lower premium and a higher out-of-pocket payment

When it comes to 401(k) plans, here’s how their interests differ.

Gen Xers want: Millennials want:Access to an app or a website with a computer-based login, but also with paper management options and a toll-free number to call to speak with a live personAn app that is mobile-enabled to manage their plan anytime, anywhereAn investment portfolio they are comfortable with from a risk perspectiveTo be more hands-off so a plan with auto-enrollment works wellAn investment plan that provides stable value or a guaranteed income fund that might be very low risk but provide for a steady flow of interest at 2% to 3% locked inAn investment vehicle that adjusts based on the end target date of 2050/2055, with a more aggressive strategy at the beginning when the person is not looking to take money out, and then later ratchet that back to more secure investments like bonds or cash equivalents to reduce risk when nearing retirementAn annual review with a financial advisorA plan they can “set and forget” with the help of an automated advice platform or so-called robo advisor, auto-entry templates and online chat support, to self-manage and automate as much as possible while also getting their information on their terms (e.g., via a chat feature versus driving to meet with an advisor)529 payroll deductible plans to save for children going into college401(k) student loan matching contribution

These all sound like good ideas if you are a Fortune 500 company. But what if you’re a small or midsize firm? To compete for the same talent with comparable resources to large organizations the best solution is to partner with a professional employer organization (PEO). PEOs help small- to medium-sized financial advisory firms with HR solutions in the areas of compliance, payroll, benefits, compensation benchmarking and risk mitigation. Research found that companies which partner with PEOs:

Employment of personal financial advisors is projected to grow 15% from 2016 to 2026, much faster than the average for all occupations. As the population ages and life expectancies rise, demand for financial planning services should increase. Are you geared to attract and retain the best talent available in the market by offering targeted benefits and 401(k) plans to the current and future leaders of your organization?


Paul Forlenza is senior director of benefits at Oasis, a Paychex Company. Oasis provides HR solutions in the areas of payroll, benefits, HR services and risk mitigation to help businesses to improve productivity and profitability so they can better focus on their core mission and grow.

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