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Wealth transfer: Is your firm’s share walking out the door?

Heir outreach, digitalization and a diverse advisor base are the keys to success.

Overview

Baby Boomers are expected to pass down as much as $30 trillion in assets to heirs and family members in the coming years, but wealth managers shouldn’t be jumping for joy just yet.1  Accenture’s Voice of the Advisor survey suggests that as little as 20 percent of those assets will remain with benefactor advisors after inheritance.

In this Accenture report, we examine how wealth management firms can retain core segments and their wealth by bolstering heir outreach, embracing digitalization, and building a diverse advisor base that works for women and young heirs.

DOWNLOAD WEALTH TRANSFER: IS YOUR FIRM’S SHARE WALKING OUT THE DOOR? [PDF]

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Kendra Thompson

Kendra Thompson

Wealth Management Lead,
North America
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MEET THE NEXT GENERATION

Between 2031 and 2045, 10 percent of total US wealth will change hands every five years. Some research suggests that as many as six out of every 10 Baby Boomer heirs will leave their benefactor’s advisor upon inheritance. Who are these people and what are they seeking?

Millennials—and millennial women, in particular—will play a prominent role in the upcoming intergenerational wealth transfer. While old-guard investors may balk at robo-advice and other digital services, 51 percent of their heirs are interested in digital-only relationships. Similarly, women, who are set to inherit 70 percent of total wealth transferred over the next 40 years, are looking for wealth management experiences that are transparent and interactive with frequent touchpoints.

THREE STEPS TO WEALTH RETENTION

Wealth management firms must take steps now if they wish to retain core client segments, including millennials and women, in the future. Accenture has identified three key areas for improvement:

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Heir outreach: Eighteen percent of advisors have never met with their clients’ children, and 53 percent meet with them less than once per year.2 So when these heirs inherit wealth, they have little loyalty to their benefactor’s advisor. Meeting with future heirs early and often is essential for building intergenerational relationships.

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Digitalization: An estimated 91 percent of millennials use social media every day, but only 39 percent are connected to their advisor on a social platform. This generation is accustomed to 24/7 mobile access, fewer face-to-face interactions and more digital touchpoints than their parents, so a strong digital presence is critical.

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Advisor diversity: Firms need to begin building teams that are capable of addressing the diverse needs of a multigenerational client base. They can start by looking to savvy advisors for inspiration. These professionals understand the importance of broadening their nets in terms of client relations and matching younger advisors with their peers on the client side.

Making these changes is no easy task, but the cost of inaction is high. Fail to keep pace and your wealth management firm just might see its share of $30 trillion walk right out the door.