ADVISORS TARGETING MILLENNIAL INVESTORS

Firms recruit young advisors to better serve next generation of clients

Financial advisory firms are increasingly recruiting younger advisors to help members of the millennial generation invest for the future.

Millennials already make up more than 35 percent of the U.S. workforce according to the Pew Research Center, and are expected to inherit more than $30 trillion over the next few decades. However, only 25 percent of financial advisors are below the age of 40 – and only 10 percent are less than 30, Pew noted.

Meanwhile, Cerulli Associates reports that 66 percent of children who receive an inheritance do not stay with their parents’ advisors. Add in millennials’ preferences to deal with people from their own generation, plus the expected retirement of 37 percent of today’s advisors within the next decade, and it’s no surprise that more firms are actively recruiting younger financial advisors.

“It is certainly necessary to expand into the younger generation,” said Jeffrey Lesniewicz, senior partner at The LAT Group – and a financial advisor with Raymond James Financial Services – in Downers Grove, Illinois. “We’re bringing in younger people, training them, and making them part of our team so we will be prepared as the millennial opportunities open up.”

The growth in automated trading platforms such as Robinhood reflects young people’s growing interest in investment opportunities. While some advisors seem threatened by these technology-driven trends, Lesniewicz said, he feels the platforms add new liquidity and volatility to markets while providing opportunities to more people to participate.

“It brings a more educated investor to the marketplace across the board,” he said. “It’s only going to create more valued and educated people in the market.”

At some point, Lesniewicz said, some of today’s independent young traders will be looking for advisors who can help them build on their gains from individual investment activities, such as those produced in the recent GameStop stock price surges.

“What happens one day when they say, ‘I don't want to do this myself anymore’ and they begin to seek out long-term advice? They're going to come find someone like us,” he said.

Once the pandemic ends and people are no longer stuck at home, many of these investors may no longer continually monitor the markets through apps and devices, Lesniewicz added. New and different trading strategies are likely to emerge once these new traders are no longer watching their screens all day.

“I'm not saying I encourage my clients to get on our mobile app and start trading all the time,” he added.

“But I have to be an open book. They want our opinion. If they think they can go trade something, I'm not going to tell them don't do it.”

Regardless of client age or expertise, educating investors is a central part of The LAT Group’s approach. The firm has offered educational workshops for many years and continued that process during the pandemic through webinars.

“I coach a lot of kids’ sports,” Lesniewicz said, “and we're always preaching repetition and preparation. The same goes for our business. We want our clients to know what we're doing. There's no

LAT Logos

L/R: Jeffrey Lesniewicz, Brian M. Ahern, ChFC® , CRPC® ,Danieh Kaser, James M. Thorton

worse question than a client asking, ‘Why did we do that?’ So we take a lot of time educating our clients. We don't want them ever to look at their statement and ask why we are buying something. We've already given them the reasons why we do certain things for them.”

The firm also emphasizes transparency and remaining open to each individual's opinions, needs, and individual goals. The LAT Group follows a concierge-type model and advisors are available to clients 24/7 if needed. During the pandemic, that open access paid off in reassured clients and increased business.

“Unfortunately, it took the pandemic for some people to see who we actually are,” Lesniewicz said. “People called us with concerns about everything last year – not just about money. Most brokers and many RFAs {registered financial advisors} will not let you call them when the market is closed. We were able to keep our lines of communication open with our clients during these uncertain times.

The pandemic has also given the firm time reflect on how it can reinvigorate its business and make things better for its clients in the future. Lesniewicz said he has been able to step back from daily activities, appreciate what has been accomplished, and decide how to best move forward.

Beyond adding more young advisors, The LAT Group’s growth strategy includes increasing the number of offices under its umbrella.

“We want to expand our independent branches by finding more groups like ourselves,” he said. “We know there are guys at the wire houses who are looking to move independent, and we can help with that transition. That helps our business grow, too, by adding revenue streams.”

Regardless of future growth, Lesniewicz said, The LAT Group will continue seeking clients that it likes to work with on a personal and professional level.

“The character relationship is the part we look for,” he said. “I'm not saying we all have to agree on everything, but this is a long-term deal. You don't want to be working with someone for 25 years that you're never going to see eye-to eye with. We have the opportunity to help make things right for our community of families in our book. Who doesn't want to work with people?”

For more information on The LAT Group, visit latgrp.com