In recent years, there has been a growing awareness of the importance for financial advisors to expand the breadth of clients they serve to include "next gen" clients like Gen X and Millennials. So far, however, most existing advisory firms have remained primarily focused on retiring baby boomers, and done little if anything to serve a younger clientele. Instead, the shift to working with Gen X and Gen Y clients appears so far to be primarily the domain of "younger" financial advisors - often Gen X or Gen Y themselves - taking the entrepreneurial leap of launching their own advisory firms to serve their peers.
In this guest post, financial planner Matt Cosgriff shares his perspective as a Gen Y advisor trying to establish a new service offering for younger clients, not by launching a new firm as an entrepreneur but by building it within an existing advisory firm as an "intrapreneur" instead. And as Matt notes, there is a big difference in the challenges of intrapreneurship and entrepreneurship. For instance, intrapreneurship requires justifying to the leadership why the new initiative is worth allocating limited resources of the organization in the first place, not to mention setting and managing expectations for growing the platform, but also has unique opportunities for success that come from building within an existing firm (including the opportunity for referrals from existing clients and established centers of influence, and being a realm of experimentation for the firm to vet new technology).
So if you're a "larger" established advisory firm thinking about a "Next Gen" offering for younger clientele, or perhaps are a younger advisor in a firm trying to figure out how to take up the mantle of intrapreneurship and convince the firm's owners to start serving Gen X and Gen Y clients, I hope that you find today's guest post and this example of intrapreneurship in an advisory firm to be helpful and inspirational about how to move forward in your own firm, too!
Two years ago, the thought of working with next gen clients was almost incomprehensible to an industry that has, for decades, shunned even the thought of working with anyone who didn’t have a lush portfolio and retirement specific needs. Thanks to a number of brave entrepreneurs taking that first blind leap of faith to launch their own planning practices for millennials and Gen X, and the subsequent launch of financial planning platforms like XY Planning Network to support them in that quest, we’ve seen a dramatic shift in the way we think about working with next generation clients.
However, despite the increasing conversation in our industry around how to work with the next generation of clients, it has largely had an entrepreneurial focus (advisors who will serve next gen clients by creating their own standalone firm to do so). There has been far less discussion around how an advisor might build out a unique service offering within their established firm, to cater to the next generation of clients.
In today’s blog post I hope to refocus the conversation from “how can I as a solopreneur begin working with next gen clients” to “how can I within my existing firm begin working with next gen clients?” The aim is to provide a blueprint and inspiration to those advisors and firms who have interest in connecting with next gen clients and are looking for insights on how to begin. I will also examine a number of the unique hurdles and challenges that are relevant as an intrapreneur that I found to be very different from those challenges I had anticipated while considering the entrepreneurial route.
The inspiration for today’s blog post has taken shape over the last twelve months as the firm I work for, BerganKDV Wealth Management, launched a separately branded next gen financial planning service model, Lifewise. After leaving my previous firm in July 2014 with aspirations of launching a next gen practice on my own (inspired by a guest blog post written right here on Nerd’s Eye View) I ended up joining the team at BerganKDV to spearhead the launch of a next gen service model within an existing organization.
The journey over the last twelve months has been an incredible one, with lots of ups and downs, lessons learned, and knowledge gained. The journey even took a pit stop in Boston to discuss intrapreneurship at the national FPA Conference in September, which sparked numerous calls and emails from advisors around the country wanting to discuss how we launched our next gen practice within a firm. My goal in this guest post is to provide even more clarity to those advisors and firms on how they too can begin to tackle the next gen jigsaw puzzle within their very own organizations.
Determining If You Should Be an Intrapreneur or Entrepreneur
Before exploring the differences between the two approaches for advisors – entrepreneurship or intrapreneurship – it helps to first define what the lesser known word, intrapreneur, actually means. Glimpses of the word intrapreneur, as it is used today, first appeared in the Economist in 1982, but it wasn’t until 1992 that the American Heritage Dictionary established a more formal definition of intrapreneurship.
So what is intrapreneurship? It's defined as “a person within an organization who takes direct responsibility for turning an idea into a profitable finished product through assertive risk-taking and innovation.” Having now lived the intrapreneurial journey, I can say with experience that that definition, while dated, is spot on.
Being an entrepreneur is hard for countless reasons, but I’d argue that being an intrapreneur is far from the easy way out just because there’s a salary attached. In most cases, the risk of losing your hard earned savings (and possibly the money of loved ones) is no longer as relevant. However, being an intrapreneur does bring with it other risks, like career risk and a damaged reputation or negative perception of you within an organization if the “pet project” flops.
Being an intrapreneur has also required an additional set of skills beyond those typically necessary to be an entrepreneur. These include the ability to navigate corporate budgets, build excitement for a product or service inside an organization that may have long-shunned the concept (e.g. serving clients with less than $1 million), and most importantly the ability to manage expectations (since growth doesn’t happen overnight).
So how does an advisor know which path is right for them? Unfortunately there is no easy answer to this almost existential question, because the answer largely depends on the advisor’s aspirations, skills, and wants out of their career and life. When you’re considering your options it is important to be really intentional about trying to figure out what it is that makes you tick. Do you love working through every micro detail of a financial plan, or do you find yourself more motivated by finding new clients to help in developing new business? Do you want to travel and be a location independent financial advisor, or do you prefer the buzz of an office and the daily interaction with colleagues? Answering all of these questions and getting really clear on who I am as an advisor was critical for me in determining which path was best at that particular moment in my career.
In the end, the opportunity to be innovative while serving next gen clients with more support and the opportunity to run with other passions, like retirement plan consulting and also working with a handful of traditional retiree clients inside a firm was perfect.
Convince Critical Advisory Firm Decision Makers
I learned very quickly while launching Lifewise at BerganKDV that launching a business as an intrapreneur is very different than launching one as an entrepreneur. As I considered the launch on my own over a year and a half ago and in talking with many industry peers, the big hurdle was always whether or not to take the leap of faith. However, once inside an organization I quickly learned the importance of and challenge in convincing key decision makers why scarce company resources should be redirected to something outside of our core focus that had made BerganKDV Wealth Management successful for more than a decade.
As I began to develop the strategy for convincing key decision makers “why next gen” and ultimately what I would be intrapreneuring, I found it critical to consider how a next gen solution would impact each person within our organization, from our wealth management team to those working in tax, audit, and technology. Within any organization, each person has various vested interests, and it is important to fully understand those and how any potential disruption could impact them.
After about two months of working to establish exactly who our target client would be and building out an initial service and pricing model to serve them, I made a presentation to our wealth management team on the ever-changing landscape of the advisor industry, what it all meant potentially for our team, and ultimately what I believed the business opportunity to be (i.e. launching a next gen model). Keep in mind this is a step that entrepreneurs are fortunately able to avoid (assuming they aren’t trying to raise capital), but it is absolutely critical inside an organization.
In our case, the pitch was essentially that a next gen solution could accomplish five critical things for our organization:
- Add additional revenue by focusing on a new niche market. A next gen model was an opportunity for us to expand our niche profitably with a new service model focused more specifically on accumulators and less on decumulators.
- Help improve the segmentation of our clients by offering a more streamlined service model focused on delivering advisor gamma to young professionals in a way that they wanted, meaning we didn’t have to try and service those enticing young lawyer or doctor prospects in a full-service model unprofitably for years until they had sufficient assets to pay for full service (if they even stuck around long enough given the low service they’d likely receive as a “small” client).
- It would help us truly become a multi-generational firm, improving sustainability by decreasing the average client age, while improving our ability to profitability serve heirs of clients, when appropriate.
- It would serve as a lower-risk testing and perfecting grounds for forward thinking technology that could ultimately be used to enhance our primary revenue model (i.e. virtual meeting technology, online scheduling technology).
- Lastly, if not most importantly, it could serve as a training grounds for young advisors interested in serving their peers, while gaining valuable experience managing a book of less risky firm revenue. Take for example, a young advisor operating in a next gen model serving 100 clients, each generating $1,500+ in revenue a year. This means the advisor is easily managing over $150,000 in growing revenue, which if they are also doing some associate advisory work or providing value in other ways, is probably a vast improvement over the traditional cost center that are young employees (who are usually incapable of bringing in their non-existent millionaire friends).
Ultimately convincing key decision makers “why bother” is different for every organization. For some, it might not make sense to begin serving next gen clients, and it certainly will never make sense to fake it or attempt things with less than a fully focused effort, but for those inside organizations with a passion for catering to their next gen peers it is critical to get to the why and to get supporters on board who can help advocate for your cause and the future you hope to build.
Keep A Lean Start-up Mentality
In the critically acclaimed book, the Lean Start-Up, author Eric Ries introduces the concept of a Minimum Viable Product (MVP), which is the minimum form of a business product or service that can be launched at the onset of an idea to test the marketplace with early adopting clients. Zappos, for example, first tested their online shoe store concept by posting photos online of shoes taken at brick and mortar stores and then going back to manually purchase and ship them before investing fully into infrastructure to support a fully web based shoe store.
So how does this relate to working with the next generation of financial planning clients? The truth is, a lot! In hindsight, one of the biggest mistakes we made during our launch was trying to create the perfect next gen solution before launching. We spent months developing a separate brand and website that we hoped would resonate with next gen clients, a pricing model that was affordable yet profitable, various service models that solved relevant financial planning issues, and thinking through and developing scalable operations before we ever had a paying client.
In hindsight, we could have been quicker to market with our concept had we simply created our own MVP. This could have been something as simple as a blog about millennial personal finance issues, a brochure or just an idea that could be articulated to the target market, and then tested it with children of existing clients and other people within our own personal networks. Existing firms are in a unique position to launch an MVP because it is likely they have significantly more distribution channels (e.g., via referrals from existing clients and existing centers of influence) to test a concept, compared to a solopreneur who needs to become profitable quickly before the proverbial war chest runs out but has no existing channels to get new clients fast.
The takeaway for those inside an organization is this: If we were to do it all over again, in the first week I would’ve settled on a working name and initial brand for the solution (i.e. ABC Wealth Lite) and the first basic service offering (i.e. a $999 mini plan tackling top three issues) that could be used to test viability of the concept. After that I would’ve immediately begun talking with every center of influence, target client and just about anybody else that could be a potential customer or referrer in search of feedback on our solution. If people start buying immediately then great, we know we are onto something. And if they don’t, they’re likely to provide candid feedback on what they don’t like, whether that be related to price or perceived value. All of which is critical information that can be used to refine the solution.
All of this is not to say you shouldn’t spend serious time thinking through your model, what its differentiators will be in the marketplace (i.e. specialize in working with MBA graduates, attorneys or teachers) and why it is you even want to go after this demographic. Instead, the point is to urge you to keep a lean start-up mindset. There is already empirical evidence that working with young clients can work –look no further than many of the XYPN success stories - so now it becomes testing whether or not your model and its unique differentiators will work. Rather than spend months building, use an MVP as a tool to inexpensively test your model and unique differentiators within your existing market before investing heavily into something unproven.
Ditch the 25-Page Financial Advisor Business Plan
Much like the proverbial bible sized financial plan has become a thing of the past, so too have encyclopedia-thick business plans full of charts, graphs, and information on the market opportunity. I spent weeks developing and writing a business plan that would have certainly gotten an A in any entrepreneurial class and that I was eager to share with the leadership team at BerganKDV. However, I can all but guarantee that I was the only person to ever read the business plan. Advisors and owners of today’s firms are far too busy in today’s world to spend time sifting through pages and pages of a detailed business plan, no more than executives are far too busy to do the same with a financial plan the size of an encyclopedia.
Instead, create a one page actionable business plan that can adapt as your model does. I eventually used a concept called the Business Model Canvas which requires you to outline nine critical functions of your business concept that include: key partners, key activities, key resources, value proposition, customer relationships, channels, customer segments, cost structure and revenue streams. The best part is that this all has to be done in one page. So spend some time outlining your model and the nine key components to making it a success and then get out into your target market and test your MVP
We’ve made tons of tweaks, adjustments and iterations (as you can likely see from the presentation I linked to above and our finalized service overview), each one has come with a new learning opportunity, and yet none of them required us to go back and rewrite the whole thing. You might find that your model of providing financial planning to tech entrepreneurs by distributing it through the start-ups that employ them doesn’t work, or you might find that taking financial planning to (insert place here) is catching on like wildfire. If it doesn’t work, this is when you begin to test new models. If it proves successful it’s time to get to work marketing and scaling your model.
Advisor Autonomy is Critical to Success
Likely the most critical aspect of a next gen solution within an existing organization is autonomy. This is as important for the business model as it is for the technology and systems that allow you to execute on that model. Launching a next gen model will not work if you simply take the prototypical 1%-AUM-fee wealth management model that has been successful for years, and tack the word millennial to it. “Go launch a next gen model, but keep in mind our $5 million minimum” will not work when it comes to connecting profitability with next gen clients. Millennials and Gen X want something different, and because of this the existing traditional wealth management model is not equipped to work with next gen clients.
In my case, I’ve had the autonomy to craft a unique business and pricing model that works to solve the relevant issues for the target market we chose: extremely busy, tech oriented, working professionals, priced in a way that we feel can be profitable. One of the many reasons that young professionals are not attracted to the traditional wealth management model in the first place is because in many instances the industry has focused historically on solving issues that aren’t relevant to them. Retirement planning and income distribution are great, but for the 35-year old with $50,000 in student debt and a new home purchase on the horizon, retirement is far from their most pressing financial priority. Uber has revolutionized the way people order rides, AirBNB has revolutionized the way we travel, so there is also a certain implied expectation among millennials and Gen Xers that if they work with a financial advisor the client experience should be equally as forward looking, meaning no 100-page financial plans.
The point here is that with autonomy comes the opportunity to craft a service model that more clearly focuses on solving those highly relevant issues for the target market you wish to serve, which ultimately has allowed us to better target our marketing to those relevant pain points. But how does one go about actually garnering the level of autonomy needed to make a next gen service model work inside an organization? Ultimately it all comes back to convincing leadership and getting key decision makers on board.
Forward-Looking Advisor Technology, Minimizing Costs, and Operational Efficiencies
Leveraging non-legacy technology (i.e., new tools and technology not already used in the firm) has the opportunity to do two things with a next gen service model: keep operational costs low through efficiencies (e.g. onboarding and automated rebalancing) and deliver a technology enhanced client experience (e.g. smartphone app).
The first step is determining if the current line-up of technology within your firm is sufficient to deliver on the client experience you’ve envisioned, as well as driving operational efficiencies. In the case of Lifewise, we felt in some areas it was worth some added cost to duplicate our technology, and we also added some platforms solely for our next gen solution (remember also that this model can serve as a testing grounds for possible broader adoption of technologies across the firm, with less risk). For example, our traditional model was happily using MoneyGuidePro, which is a fantastic tool, but it is largely a goal based platform meaning 5-year cash flow projections for a young doctor twenty years from retirement were virtually impossible. That led us to adding eMoney as a means of streamlining data aggregation and the cash flow based planning modules for improved short and intermediate-term cash-flow planning.
On the investment side, we decided (somewhat obviously) to move away from customized portfolios and instead to move forward with a more scalable robo solution. We settled on Betterment Institutional for its Apple-like user experience after also exploring Upside (before it was acquired), Schwab and JemStep. This has allowed us to automate the entire investment process from onboarding to ongoing management, allowing for more focus on what we believe to be most valuable to clients – planning. The other perk is how effortless clients find it to get started – something that is essentially table stakes for serving this target market. We often heard new clients responding afterwards with “wow that was easy!”
In hindsight, one thing I would reiterate is the importance of testing your concept with a lean start-up mentality in mind, especially when it comes to infrastructure. If I had to do it all over again, I would’ve jumped less quickly into implementing non-legacy systems and instead leveraged existing infrastructure to get to market quicker. Obviously that strategy comes with the risk of not delivering on the client experience you are hoping to deliver, so it’s admittedly a delicate balance. Nonetheless, it is important to keep in mind that each additional technology comes with not only an additional monetary cost (which is oftentimes pretty low for one or two users), but also the cost of additional overall business complexity (and the time it takes to work through).
Ultimately, for any next gen planning model I believe there are four technologies critical to success inside a firm:
- A quality financial planning program that can help clients with cash flow and monitoring accounts;
- A seamless payment platform that can collect ongoing retainer payments;
- A fully integrated CRM; and,
- As noted above, a robo platform for operational efficiency.
I won’t go into the specifics of which tool and why we chose each various technology, as much of this has already been discussed in impressive detail in other “next gen” advisor guest posts here and here.
If You Build It… They Won’t Just Come
Robo platforms are everywhere and they are, in an effort to become profitable, increasing their focus on advisors instead of solely the retail market. Yet as more robos provide advisors with the ability to launch their own robo offering, it becomes less unique for advisors to have this solution.
In fact, it is not unreasonable to think that within a few years every RIA and BD could have a robo platform connected to their website that potential clients could sign up for. There are essentially no barriers to entry for advisors when it comes beginning to use a robo platform, as most of them are essentially plug and play solutions and many of them have no up-front costs to the advisor, which only furthers the likelihood that advisors will tack these platforms to their websites as a way to service small clients who might not fit into their current service model. With all of this said, none of us should fall into the trap of thinking that if we simply build it they will come. Robos do not solve the client acquisition problem, instead they help make serving clients more efficient, particularly ones with small balances once they’ve already been acquired.
All of this is to hit home the point that if you are giving thought to the launch of a next gen solution within your firm, it is critical to get really clear on one detail: How will you acquire those new next gen clients? Solving this challenge is paramount to everything, and it only becomes more important given the revenue generated by many next gen clients will certainly be lower than the more traditional $5,000 to $20,000 annual fee generated by some top wealth management clients.
For us, we were very deliberate in how we announced the launch of Lifewise, internally and externally, as we began to search out prospective clients. Once the solution was finalized, I made two firm-wide presentations, given largely to a CPA and technology consultant audience, to outline four critical points: what Lifewise is, how Lifewise differs from the traditional wealth management model, why they should care, and who Lifewise is for.
Inside an organization, yes, it is easier to begin building relationships with potential centers of influence and referral partners down the hall than it is for many solopreneurs who are trying to get inside potential referral organizations (i.e. law firm, CPA firm). But the referrals do not just begin because we happen to share office space. In fact, the hard work is only just beginning as I work to build relationships to the point where any potential referrer, even internally, knows that any client they refer to Lifewise will ultimately be well served.
When it comes to launching externally, we distributed a press release with minimal success, while also participating actively in social media, blogging and other more traditional avenues such as networking events.
So far, we’ve found that internal referrals have been the most natural and quickest to occur, given that much of the relationship foundation has already been laid, by our team and department. But ultimately we fully intend to generate more business externally and online, knowing it will certainly take time.
Balancing Advisory Firm Profitability and Singular Focus
Likely the single greatest challenge of launching a firm within an existing organization has been finding the delicate balance between remaining profitable as an employee advisor, and remaining focused on building a new business. “Side-hustling” or more simply, doing various forms of side work to generate income, is one of the ways many solopreneurs have extended their runways while launching their practices.
Inside a firm it is critical to remain a profitable member of the team as an advisor, even while launching a new service model. This could mean doing paraplanning work, serving as an associate advisor, working with traditional wealth management clients, developing new business or working with retirement plans. Whatever the method, it’s important to continually provide value to the firm (which also helps to mitigate career and perception risk within the organization).
The difficulty, however, is that this is a very slippery slope. When side-hustling on your own, you fully control how much additional work you take on. For example, “I’m going to work part-time 10 hours a week to generate some income” or “I’m going to write four guest blogs a week for money.” However, inside a firm, especially one that is growing and where there never seems to be enough hours in the day, when your time isn’t as fully committed to serving clients yet, it becomes easier to fall into the “yeah, I’ll help with that” or “sure, I can take on that project.” We all want to help, prove our value, and ensure that we aren’t just an expense item on the financials, but the important distinction is that each of these opportunities to prove value detracts from building the core business.
The takeaway is simply to be extra aware that every additional minute spent doing something else only delays from the long-term growth of your next gen initiative. There’s only twenty-four hours a day, and oftentimes the best solution to accomplishing more, is simply to do less.
The Initial Investment, Quantifying Breakeven, and the Intangible Values to Our Business
The good news for those looking to launch a next gen model within their firm is that it doesn’t have to involve a major financial investment to get started. In fact, much has been written about how little money is needed to actually start an independent RIA and despite some additional overhead inside a firm, it’s really no different when it comes to launching a separate service model.
In fact, one of the distinct advantages intrapreneurs have over entrepreneurs is the ability to start lean. As an entrepreneur you have to be profitable before your war chest runs out or risk going belly up, while inside a firm somebody with a day job can start small, testing the concept for an hour before work each day, then ten hours a week, then twenty, ultimately leading to the point where the new model can be built, scaled, and turned into a profitable segment of the overall business.
For me it was important from the onset to demonstrate what the path to breakeven and ultimately profitability would be. This included creating pro-forma three year financial projections (in the form of an Excel spreadsheet breaking down projected revenue growth, expenses, and ultimately profitability). In my case, being inside a firm, I included a pro-rata portioning of my salary to account for the cost of actually doing the work outside of my intrapreneurial side-hustling. We ultimately expect my portioning to increase over time as Lifewise grows, and are confident that within 12-24 months we’ll have recouped the initial investment in infrastructure and the development of a website.
Most importantly, though, the financials helped to demonstrate that serving this demographic could be profitable, as well as many of the empirical XYPN success stories. The one caveat that we probably underestimated was that, while serving these clients can be profitable, the Cost of Client Acquisition (CAC) has been a larger hurdle than we expected. Next gen clients are incredibly underserved, but that unfortunately has not meant that a critical mass of young professional clients has magically appeared. There is still (as noted above) a lot of hard work associated with acquiring clients, so be sure account for initial costs of client acquisition when projecting out initial expenses. This can be something as simple as marketing dollars, or more likely the time and effort required to actively engage in social media, blogging, and other more traditional methods of business development.
It’s also worth recognizing again the intangible value that Lifewise has provided to our firm, which goes back to a number of the points made while convincing “why next gen.” Admittedly, it’s not easy to quantify the less tangible benefits of improved client segmentation, complementing existing a decumulating client base with accumulators, and providing a profitable training grounds for young advisors, but nonetheless it is important. Each of these aspects of our initiative, I believe, have an important role to the future of our overall business as it serves to improve our business operationally, serving tomorrows clients today, and empowering our firm’s advisors of the future.
So what do you think? It is possible to work profitably with the next generation of clients inside an existing organization firm? What other hurdles do you think might get in the way of launching a unique service offering within your organization? What’s stopping you from trying? Are you inspired by this kind of example of intrapreneurship? What kind of MVP can you create to test the viability of working with next gen clients in a unique way? Is it necessary to brand a next gen solution separately?
Paul Beckis, CFP® says
What a great article! Thanks for sharing your insights. My wheels are spinning.
Matt Cosgriff says
Thanks Paul! Glad the wheels are spinning 🙂
Tyler Furger says
Awesome article. I can relate. I appreciate the way you broke that down. I thought I was the only one out there doing this (intrepreneurship). I read articles by Michael and follow XYPN, but ultimately have been given enough latitude to build my own thing intrafirm I haven’t needed to leave my firm.
That being said, it certainly does feel like I am running into a wall when I’m talking with some of the other advisors who believe you can only make it by going after the boomers….
I am wondering if you could share resources RE: approaching other advisors intrafirm. It’s untapped potential where I am at but I’m unsure of what to say, how to approach them, etc. Any thoughts or direction is appreciated.
Matt Cosgriff says
Tyler I feel you on having to make the case for “why!” I think it varies for every firm depending on structure, size, etc.
The “Presentation” I used to make my case is linked above, feel free to pull anything out of there too, but obviously some stuff might not be applicable to your firm.
See if you can also create an MVP to try and start demonstrating some traction in the space which might help make your case easier.
Let’s connect on LinkedIn if you have more questions.
Charlotte Jacobs says
This is great! I have been talking to my firm owner about this over the last couple of months.
I am taking the CFP exam in March, so I have been devoting my time to preparing for that and “planting the seed” for adding next gen offering with him as opportunities came up. He came back from the AICPA PFP conference in January and said, “I totally get what you were talking about now. What do we need to make this happen?” You have given me a good outline to consider as we move forward with this!
Matt Cosgriff says
Thanks Charlotte!! That’s awesome news and best of luck with the CFP. Let me know if I can help answer any questions as you move forward!
Matt Cosgriff says
Thanks Charlotte!! That’s awesome news and best of luck with the CFP. Let me know if I can help answer any questions as you move forward.
Kacie Swartz says
Thank you for sharing so much information! Is Lifewise available to only certain age ranges? Can you address positives and negatives that may come from existing BerganKDV Wealth Management clients wanting to switch over to the (assumed) less expensive Lifewise Plan? How have or will you handle that issue?
Matt Cosgriff says
Kacie great questions! Lifewise isn’t explicitly limited to a certain age ranges, although the service model is certainly built to be attractive to young professionals that are technology inclined and looking for financial guidance on relevant issues to them (i.e. student debt, college planning, etc). The brand and marketing are geared towards specific age ranges: young professionals 28-45. With that said, if someone is on the cusp of being a baby boomer and a Gen Xer we wouldn’t say “no” to them if they had planning needs and wanted to work with us through the Lifewise brand.
There is certainly some risk with having clients want to move to the less expensive model Lifewise model. However, we believe that the traditional model provides additional value that aligns with client’s increasingly complex financial lives as they near or enter into retirement. For our “traditional” model that additional value has an added cost (i.e. usually two advisors working with the client, in-house tax and estate specialists, customized investment portfolios) which is why it tends to be more expensive. These value-adds are how we plan to transition clients as they grow with us and eventually have needs that are more complex. Given how new Lifewise is we will have to cross that bridge a bit when we get there too 🙂
I’d also add that I think 5-10 years from now the traditional service model will look a lot more like the millennial/Gen X service model of today (i.e. retainer fees, technology enhanced, virtual meetings), so I think from a service standpoint things will start to look a lot more like each other, which should hopefully help make the transition easier.
Kacie Swartz says
I totally agree – and thank you for the thoughtful response!