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Here’s a story about two houses. One belonged to a baby boomer, and it was his pride and joy.
He graduated from college in the early 1970s, got his first job, and started saving. When he received a small inheritance from his grandparents, he finally had enough, at age 29, to make a down payment on a starter home. For the next 30 years, he faithfully made mortgage payments while also trading up to a larger residence in his mid-40s. By the time he retired in the early 2010s, his home was paid for. He took an income from the 401(k) to which he had contributed during his working years and that, plus Social Security, assured him of a reasonably comfortable retirement.
The second house didn’t belong to the boomer’s Gen Z grandson — not yet. Having graduated from college with considerable student loan debt into the middle of the COVID-19 pandemic, he didn’t encounter a ton of companies looking to hire. So, like many young people his age, he integrated himself into the gig economy. While his skills in content creation and social media networking enable him to maintain a relatively steady income stream, servicing student loan debt and taking care of housing (read, “rent”), transportation, and other regular expenses hasn’t allowed for the excess savings needed to fund a home down payment or significant contributions to a retirement account.
What a Difference a Generation (or Two) Makes
With just a few alterations in some details, most of us can probably recall a scenario like that between the boomer grandfather and his Gen Z grandson. As the world around us continues to change at an accelerating pace, each generation responds to the changes in unique ways that often appear incomprehensible to other generations. And those differences are nowhere more important than when comparing baby boomers and Gen Z.
Gen Zers (roughly, those born from 1997–2012), along with their millennial and, to a lesser extent, their Gen X counterparts, are set to inherit around $106 trillion in assets from boomers between now and 2048. But the differences in the financial and sociopolitical landscape between the time boomers came of age and the environment that is shaping Gen Z could hardly be more stark.
The foundational elements that boomers relied on — affordable education, housing, and healthcare; solid institutions; ease of entry into the job market; and a predictable career path — are quickly eroding. Gen Z is also the first completely digital native generation; they have never known a time when an entire world of information couldn’t be held in the palm of your hand.
Not surprisingly, these two factors have combined to predispose Gen Z to treat much of life — including financial planning — like a video game (remember the GameStop craze?). They are more likely than previous cohorts to own cryptocurrency and engage in online sports betting or prediction markets. In fact, according to a recent Harris poll, nearly two-thirds of Gen Z and millennial respondents believe that the only way to build significant wealth is through “alternative methods.” In other words, their trust in more traditional wealth-building means (like a steady 9-to-5 job and systematic, long-term investment in the financial markets) is much lower than that of their boomer parents and grandparents.
So, What’s a Marketer to Do?
A lot is at stake for the financial planning profession as Gen Z comes of age. Remember: It is the world’s second-largest age cohort, at about 1.9 billion, making up almost 23% of the world’s population (only “Gen Alpha,” born 2013–2024, is larger, at just over 2 billion). How can financial planners and wealth advisors effectively reach a generation that faces the challenges and possesses the particular biases and traits exhibited by much of Gen Z?
1. Get Social
An overwhelming majority of younger Gen Z members (90%) are regular users of social media. 60% use Instagram to discover new products or services. Nearly half (48%) say they purchase products and services sourced from social media.
2. Think Video and Podcasts
Almost three-fourths (73%) of Gen Z watch ad content on platforms such as YouTube, Hulu, and others. 62% of them use YouTube daily. In fact, short-form videos and podcasts are a favored means of acquiring new information (an estimated 35 million Gen Zers listen to one or more podcasts every month). Instagram, with its visually oriented content, is also a strong favorite.
3. Engage promptly (preferably digitally)
Not surprisingly, Gen Zers place high value on efficient digital engagement. In other words, insisting on face-to-face or other real-time contact methods is almost guaranteed to lose them. One boomer parent told us, “If I want my kids to answer me, I have to text them. Voice calls go straight to voice mail.” Firms that want to effectively reach a Gen Z client base should invest in platforms that optimize user interface/user experience (UI/UX) and mobile-first utilization.
4. Use Your Influence(rs)
Influencer marketing has almost become a by-word in some areas, but this is still one of the strongest tools for reaching Gen Z. Explore opportunities for partnering with trustworthy content providers, especially those with proven digital platforms. Keep in mind that they may not be primarily in the financial service space; getting a guest spot on a lifestyle or social issues podcast can lead to warm, value-driven engagement, crucial for capturing younger, experience-focused demographics.
5. Demonstrate Understanding and Empathy for Their Concerns
Many may now be thinking, “Of course; empathy for client concerns has always been required.” But with Gen Z, “know your client” comes with some special considerations. Remember, this is a generation that is dealing with more student debt than any in history, along with a housing market that looks increasingly out of reach and vanishing entry-level job opportunities as they are swallowed by the AI python. Gen Z’s prime earning years will be disrupted by all these factors, and the current politically polarized atmosphere and resulting breakdown in some institutions isn’t helping their confidence. By engaging honestly and forthrightly with these concerns and providing authoritative, evidence-based advice via channels they prefer, Gen Z investors can be meaningfully influenced.
6. Know Their Themes
Gen Z consumers (and potential clients) are likely to be skeptical of any approach that seems overly institutional, “salesy,” or otherwise inauthentic. In fact, they are likely to value authenticity over polish. They value the ability to make up their own minds based on data they discover or verify for themselves. They are interested in social and environmental justice, to the point of requiring it in their investments (though they also expect performance). They are likely to be pragmatic rather than excessively optimistic, and they may have an entrepreneurial mindset (i.e., reluctance to participate in institutional settings). As savvy consumers, they are financially conscious; many of them use DIY/AI-driven investment platforms and may require convincing of the advantages of a relationship with a brick-and-mortar advisory firm. Above all, they want to be heard.
Bottom Line: Keep It Real
Like every generation before them, Gen Z is coming of age in a world very different from that of their parents (and even their older siblings, in some cases). Advisors who want to connect with this cohort need be conscious, not only of Gen Z’s biases and unique perspectives, but also of their own preconceptions and tendencies. What worked for you may not always work for them. Keep this in mind in order to avoid unjustified categorization and assumptions that will almost surely be turn-offs to the younger clients you want to attract. RIAs who can stay flexible and conversant with evolving trends in communication and values will be able to remain ahead of the curve and ready to assist these emerging investors as they come into their own.
Read more from Gretchen Halpin:
AI & the RIA: Getting Smart About Artificial Intelligence
Making It Personal: Improve Your Online Presence With Smart Data Usage
Thinking Long Term, Communicating Short Term
Gretchen Halpin is the co-founder of Beyond AUM, which provides growth, client experience, and M&A advisory services to drive business success. Over the course of her 25-year career, Gretchen has founded more than five businesses in addition to serving as the chief strategy officer for one of the financial services industry's leading wealth management firms. She has been featured in Advisor Perspectives, Financial Advisor Magazine, and Forbes for her insights and has served as a speaker at numerous industry conferences, including NAPFA, Financial Planning, and Invest in Women. She also serves as a facilitator in The Financial Planning Association’s Women and Finance Knowledge Circle community.
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
