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A winning strategy for a difficult task

20 June 2018Jonathan Faurie
Kobus Kleyn

Kobus Kleyn

FAnews attended the Sanlam Benchmark Survey where there was a major focus on Millennials and the way their influence is growing within the financial services industry. We also attended an event which was hosted by FMI where the key note speaker gave his views on how advisers can engage with clients over social media. The picture that was painted during these events was that dealing with Millennials can become very tricky for some advisers. How do they feel about this?

FAnews spoke to Kobus Kleyn, a CFP and Director at Kainos Financial Services to find out his views on dealing with this emerging customer base. 

Needy, obsessed, no plan

One of the statements made during the events that I attended was that Millennials are needy and obsessed with technology. Further, they don’t have a pressing concern about managing their finances. 

While this is a significant criticism of Millennials, it is a reality that advisers must live with. 

“I believe that in general, Millennials appreciate technology much more than previous generations. This would obviously leave a generation gap in a financial profession where the average age of advisers is older than 50. There may also be a gap in how these advisers deal with the Millennial generation,” said Kleyn.  

He added that Millennials certainly have a much shorter time frame when it comes to financial planning than older generations, and the word retirement and ideas around it has become a fallacy. 

“I think that Millennials believe that they can work forever without considering health issues as they get older. It can be argued that they feel indestructible. This does not mean that they are not interested in financial awareness and planning. Perhaps they want a fresher approach to such a planning process while having a smarter approach to it. They want to use smart technology and virtual and digital tools to communicate with advisers,” said Kleyn. 

Hard work

The above insights makes it clear that advisers are going to have to work a lot harder when it comes to satisfying the needs of this new client base. Is this hard work bordering on the impossible? 

“There is no doubt that with the generation gaps evolving quicker through fintech and technology advisers need to be on their toes. How we as advisers deal with these challenges, and the ability to adapt to both fintech and the Millennials, will determine the destiny of the adviser within the financial profession as we grow older and our practices mature,” said Kleyn. 

He added that for those who are able to both adapt to a younger generation and embrace technology, there is a huge future and new long term flow of ongoing young business into their practices. This can be achieved through ensuring succession and continuity planning with younger advisers.

“This has a lot to do with mind-set and wanting to work with Millennials. Advisers then need to respect and appreciate their unique ways, while embracing the technologies such as skype, smartphones, online communication and social media,” said Kleyn. 

Key engagement

So, we now have a lot of context about the behavioural patterns of Millennials and what they expect from advisers. How do advisers take advantage of this? 

Because Millennials are obsessed about living their life through events and life changing experiences, advisers need to start framing retirement saving as a life event. 

“This has a lot to do with the introductory consultation, focus on life changing events and driving awareness around it. Then, advisers need to follow up on this during their annual financial reviews. Advisers need to harp on about how these life changing events, and how a single moment can impact on their financial planning,” said Kleyn. 

Further, advisers cannot ignore the role that technology plays in their lives. 

“Technology is an industry disrupter. However, advisers need to communicate their value proposition to the Millennial generation through technology. How they do it between Instagram, Twitter and LinkedIn, or through a hybrid combination, would give them a significant competitive advantage,” said Kleyn 

Kleyn added that if advisers can combine this with embracing Fintech tools and online tools (robo-advice) within their practices, they should have a longer term winning combination. 

“Creating a strong social media brand, presence, and becoming a thought leader while being the go-to person for the Millennials, is indeed possible, all it takes is hard work and patience,” said Kleyn. 

Editor’s Thoughts:
The challenge within the industry is that the adviser force is aging, and advisers must deal with a young client base that acts like no other younger generation before it. Fruitful engagements are possible, it just depends on the adviser’s level of patience and willingness to embrace change. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts


Added by Shiraz Khatib, 19 Jul 2018
Often hear concerns, from experienced intermediaries in an aging adviser sales force, around technology and the next generation of clients.
But I feel that the experienced financial adviser and the millennial - can be a formidable duo!

Among other things, if they are both speaking the same language regarding lifestyles, willing to cross technology barriers and embrace trusted strategies to wealth building, preservation and management - so much to benefit from each other.

Comments from a millennial?
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Added by Kobus Kleyn, 23 Jun 2018
My sincere thanks for the opportunity to contribute to this article Jonathan
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Added by Cynical Simon, 20 Jun 2018
What an exciting article! The overall emphasis in the article seems to be on how intermediaries in the long term and employee benefit space will have to adapt to this phenomenon . I somehow suspect that the impact on short term brokers will be just as severe and I hope that the FIA will as a matter of extreme urgency facilitate in identifying experts and thinkers to lead discussion groups on Branch or Regional level on this most topical and urgent "disruption." I will be glad to assist, as would any forward thinking intermediary.
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