Things to Know About The Children of Wealthy Clients

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What You Need to Know About The Children of Your Wealthy Clients

children of wealthy clients
Chances are high that you don’t know the children of your wealthy clients personally, and the fact of the matter is that they need you.
While building multi-generational relationships might have once just been industry buzzwords, with the huge wealth transfer we are currently in, the middle of financial advisors must understand now more than ever that multi-generational clients are vital to the future of their business.

We’ve seen the statistics. Once the adult children inherit their parents’ assets, they chose a different advisor to manage the money. Ninety-eight percent of adult children who inherit wealth leave their parents’ financial advisor. Said another way, only 2% keep the assets they have inherited with their parents’ advisor.

Be sure to visit the Practice Management to learn about more ways of growing your advisory practice.

They Don’t Know You

The harsh truth is that the children of your clients don’t know you. Recent research from Wells Fargo Private Bank indicated that 78% of children of millionaires have not ever met their family’s financial advisor. Of those who have met their parent’s advisor, only 3% of them meet with their family’s financial advisor regularly.

While they don’t know you, they need you and they do see the value of working with you. The same study revealed that 88% believed having regular formal meetings to discuss finances would be valuable to them.

Ask for the Introduction

Developing a meaningful relationship with your clients’ children is imperative before the parents pass away.

If you do not know the children of your clients personally, it isn’t wise to hold back. Ask for the introduction to the children (and grandchildren). Some advisors fear asking for the introduction as intrusive. It shouldn’t come off as intrusive if you have a solid relationship with the parents.

Talking about your clients’ children and grandchildren should already be part of your conversations, so it shouldn’t seem out of the ordinary to take the next step and ask to meet them. It should feel natural to ask for the introduction. Explain to your clients that the key to successful wealth transfers is strong family communication. Establishing a relationship with your clients’ children by hosting family meetings will help you facilitate family discussions.

While some parents may not want to discuss the specifics of their wealth transfer with their children, it isn’t necessary to discuss specific dollar amounts. Instead, encourage family meetings to discuss the family’s legacy on a deeper level.

Values Matter to Them

How can you discuss legacy on a deeper level? Assets are just one part of the family’s legacy. The intangible part of the legacy is even more important.

The study from Wells Fargo Private Bank found intangible values matter the most to children of millionaires. 90% of those surveyed said the most important piece of their parents’ legacy was their parents’ values, not their assets. Research showed that eighty-four percent indicated they want to build on their family’s legacy.

This provides you with a tremendous opportunity to differentiate yourself and build a meaningful relationship with your children. Help them build on their family’s legacy. Introduce meaningful legacy conversations at the family meetings. Suggest both the parents and the children write legacy letters to each other so that their values, personals stories, life lessons and beliefs will live on after they are gone.

Having a Philanthropic Voice Matters to Them

Not only is a legacy of values important to millionaire-born children, but having a philanthropic voice is also important to them. The same Wells Fargo study showed that most children of millionaires support their family’s philanthropic giving. However, 40% said they want an even stronger voice in their family’s charitable giving.

This is another way to provide value and deepen your relationship with your children by helping with their strategy for charitable planning. This is maybe an ideal engagement opportunity.

There may also likely be an overlap with the families’ values and their charitable wishes. Their core values may drive what causes and issues they are the most passionate about. Uncover what their motivator is for charitable giving and what is near and dear to their hearts.

Every Family is Different

It is an obvious statement, but keep in mind that every family is different. The children of your wealthy clients are different too.

Be sure to personalize your approach and look for common interests. Uncovering your clients’ core values and charitable wishes might be the key to personalizing your approach in a truly meaningful way.

The Bottom Line

If you don’t know the children of your wealthy clients, all signs show that you have to ask for the introduction.

Although it sounds morbid, meeting the children at their parents’ funeral is too late. Establishing a solid rapport now will help you build and transfer their family legacy in a profound way, while allowing you to keep the family assets instead of losing them.

Don’t forget to visit the news section to stay up-to-date with the latest news from the mutual fund investing world.


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children of wealthy clients

What You Need to Know About The Children of Your Wealthy Clients

Chances are high that you don’t know the children of your wealthy clients personally, and the fact of the matter is that they need you.
While building multi-generational relationships might have once just been industry buzzwords, with the huge wealth transfer we are currently in, the middle of financial advisors must understand now more than ever that multi-generational clients are vital to the future of their business.

We’ve seen the statistics. Once the adult children inherit their parents’ assets, they chose a different advisor to manage the money. Ninety-eight percent of adult children who inherit wealth leave their parents’ financial advisor. Said another way, only 2% keep the assets they have inherited with their parents’ advisor.

Be sure to visit the Practice Management to learn about more ways of growing your advisory practice.

They Don’t Know You

The harsh truth is that the children of your clients don’t know you. Recent research from Wells Fargo Private Bank indicated that 78% of children of millionaires have not ever met their family’s financial advisor. Of those who have met their parent’s advisor, only 3% of them meet with their family’s financial advisor regularly.

While they don’t know you, they need you and they do see the value of working with you. The same study revealed that 88% believed having regular formal meetings to discuss finances would be valuable to them.

Ask for the Introduction

Developing a meaningful relationship with your clients’ children is imperative before the parents pass away.

If you do not know the children of your clients personally, it isn’t wise to hold back. Ask for the introduction to the children (and grandchildren). Some advisors fear asking for the introduction as intrusive. It shouldn’t come off as intrusive if you have a solid relationship with the parents.

Talking about your clients’ children and grandchildren should already be part of your conversations, so it shouldn’t seem out of the ordinary to take the next step and ask to meet them. It should feel natural to ask for the introduction. Explain to your clients that the key to successful wealth transfers is strong family communication. Establishing a relationship with your clients’ children by hosting family meetings will help you facilitate family discussions.

While some parents may not want to discuss the specifics of their wealth transfer with their children, it isn’t necessary to discuss specific dollar amounts. Instead, encourage family meetings to discuss the family’s legacy on a deeper level.

Values Matter to Them

How can you discuss legacy on a deeper level? Assets are just one part of the family’s legacy. The intangible part of the legacy is even more important.

The study from Wells Fargo Private Bank found intangible values matter the most to children of millionaires. 90% of those surveyed said the most important piece of their parents’ legacy was their parents’ values, not their assets. Research showed that eighty-four percent indicated they want to build on their family’s legacy.

This provides you with a tremendous opportunity to differentiate yourself and build a meaningful relationship with your children. Help them build on their family’s legacy. Introduce meaningful legacy conversations at the family meetings. Suggest both the parents and the children write legacy letters to each other so that their values, personals stories, life lessons and beliefs will live on after they are gone.

Having a Philanthropic Voice Matters to Them

Not only is a legacy of values important to millionaire-born children, but having a philanthropic voice is also important to them. The same Wells Fargo study showed that most children of millionaires support their family’s philanthropic giving. However, 40% said they want an even stronger voice in their family’s charitable giving.

This is another way to provide value and deepen your relationship with your children by helping with their strategy for charitable planning. This is maybe an ideal engagement opportunity.

There may also likely be an overlap with the families’ values and their charitable wishes. Their core values may drive what causes and issues they are the most passionate about. Uncover what their motivator is for charitable giving and what is near and dear to their hearts.

Every Family is Different

It is an obvious statement, but keep in mind that every family is different. The children of your wealthy clients are different too.

Be sure to personalize your approach and look for common interests. Uncovering your clients’ core values and charitable wishes might be the key to personalizing your approach in a truly meaningful way.

The Bottom Line

If you don’t know the children of your wealthy clients, all signs show that you have to ask for the introduction.

Although it sounds morbid, meeting the children at their parents’ funeral is too late. Establishing a solid rapport now will help you build and transfer their family legacy in a profound way, while allowing you to keep the family assets instead of losing them.

Don’t forget to visit the news section to stay up-to-date with the latest news from the mutual fund investing world.


Sign up for Advisor Access

Receive email updates about best performers, news, CE accredited webcasts and more.

Popular Articles

1

Expert Opinion

(Extra)Ordinary Income

Justin Lowry

|

At Global Beta, as we analyze the current whip sawing in the market,...

3

Expert Opinion

Time For A Mulligan

Justin Lowry

|

This quarter has been the worst quarter in over a decade. The S&P...

Download our free report

Find out why $30 trillon is invested in mutual funds.

Why 30 trillion is invested in mutual funds book

Why 30 trillion is invested in mutual funds book

Download our free report

Find out why $30 trillon is invested in mutual funds.

Why 30 trillion is invested in mutual funds book

Download our free report

Find out why $30 trillon is invested in mutual funds.


Read Next