What Advisors Don’t Get About Generation X

This is an important thing to understand because it shows you how many of our attitudes became tainted by the Great Recession that happened seven years later. People talk about how traumatic it was for the Millennials who graduated with tons of debt and had to live in their parents’ basements. Hence the distrust of Wall Street (remember the Occupy Movement?) that the younger generations had.

Here’s what people don’t realize. As bad as it was for the Millennials, it was way worse for Generation X. Just look at how the recession impacted my money.

At the time Wall Street fell in 2008 (I was actually working at Lehman when it crashed), I was right in the thick of “making it.” I had the taste of success but hadn’t really reached untouchable yet. I was earning a comfortable living in six figures and had a certain lifestyle where it was my thing to go out with my cool single friends and drop serious cash without having to sweat it. I had paid off my school debt but had made a huge investment in an MBA, plus the several years of blood, sweat, and tears it took to pass two levels of the CFA program. Yet, the job boards were empty and I was essentially locked out of the life that I loved, doubtful I would ever get it back.

It all fell apart just when it was starting to get good.

Unlike Gen Y who couldn’t get what they wanted, I had what I wanted and felt it was taken from me. Wouldn’t you say that’s more embittering?

To make matters worse, the people in my life had gone from seeing me rise up over the years from an entry-level RFP writer to a mid-level analyst at respected investment firms. I had junior analysts reporting to me. When it all came crashing down it was quite the ego bruising. That was the hardest part.

Like so many in my generation, I was too overqualified to scrounge up an entry level $40k a year job yet not established enough where people were eager to pluck me off the unemployment line. With practically no knowledge of sales, I struck out on my own as an entrepreneur rather than wait for Goldman Sachs to start hiring again. Everyone talks about Millennials and their ”gig economy” but Generation X was actually to first ones to dip our toes into this. For most of us the next best option was taking a job for a fraction of our salary that didn’t fit with our career just to pay the bills and save face.

We’re making the big bucks right now

Although many of us were set back considerably by a huge kink right when we were beginning to ascend in our trajectory, most of us have done the soul searching and recovered. We’re not where we would be if we hadn’t gone through that grandiose hiccup, – which we’re not thrilled about – but we’ve gotten back on track.

Gen X is roughly defined as people born in the mid-1960s to the early 1980s, which would put most of us at early 40s to mid-50s. There are millions of us that you advisors are overlooking in favor of the Boomers or Millennials but we’re just starting to come into our own financially. We’re not buying our first apartment, we’re thinking about upgrading to a bigger house now that our kids have grown up past the cute cuddly stage. We’re starting to have tax issues we didn’t have before from the income we are making. We’re starting to have to support our aging relatives who may be living with us. Unlike the Boomers who already have their advisors and the Millennials who probably aren’t qualified for one, Gen X is at the point where they are thinking about hiring an advisor for the first time.

Take a closer look.

We’re getting wealth handed down right now

The industry is obsessed with helping advisors to market to Millennials because one day they’ll inherit their parents’ wealth. Well I’ve got news for you; we Gen Xers are receiving that wealth now. We do share some Millennial attitudes towards investment advice (including a preference for less casual dress and more use technology instead of paper) so keep that in mind as you communicate with us.

It’s important to understand psychologically what going through a financial crisis like Generation X did can do to a person’s attitude towards money and the financial community at large. I’m 40 so I missed being a Millennial by three years. However I feel as if I embrace many of the money attitudes that people attribute to Millennials.

Yet there is a different tenor to them.

Gen X will never forget what it felt like to have it all and lose it. There is a certain risk aversion to us because the fear of losing our jobs during a systematic failure of the banking system will always be in the back of our minds.

For example, when I was an advisor I was once trying to convince a client to buy a term-life policy. She was a successful attorney making over $200,000 in salary and had almost a quarter of a million invested. Yet she still hesitated to lock into an obligation to pay a $50 monthly premium because of a fear of losing her job. Illogical? Slightly. Be prepared for this, advisors, as you talk to members of my generation.

Sara’s upshot

Everyone is talking about Gen Y and the Boomers. But if you’re focusing on them instead of Generation X you are overlooking the biggest opportunity to establish relationships with the people who are more financially qualified than a Millennial and starting to inherit the Boomer’s money. If you want to know more about how to reach Gen Xers like me then post a comment on APViewpoint and I’ll share some ideas.

Sara Grillo, CFA, is a top financial writer with a focus on marketing and branding for investment management, financial planning, and RIA firms. Prior to launching her own firm, she was a financial advisor and worked at Lehman Brothers. Sara graduated from Harvard with a degree in English literature and has an MBA from NYU Stern in quantitative finance.

Read more articles by Sara Grillo