Journal of Financial Planning: February 2017
Cam Marston on Bridging the Generation Gap and Being a Gen-Savvy Financial Adviser
WHO: Cam Marston
WHAT: Author, speaker, generational change expert
WHAT'S ON HIS MIND: “I think that the Generation-Xer is overlooked in nearly every market and in every product.”
Any business situation today—from hiring new employees to bringing on new clients—will likely involve at least two different generations, and sometimes three or four. If you feel out of touch with generations different than your own and are perhaps hesitant to work with them, Cam Marston offers this advice: understand your own generational biases first, then have empathy for others.
“Those empathetic people who can understand themselves can certainly understand the biases of other people,” Marston said. “And if their focus is truly on the success of the team, and they get rid of their biases or they set them aside to allow for someone else’s biases, they will work well in any given situation and flourish.”
Marston is a leading expert on generational change. Through his writings, trainings, and keynote addresses to corporations and organizations worldwide, he is teaching people of various generations—matures, baby boomers, Gen-Xers, and millennials—how to understand each other and work together.
And through his popular book, The Gen-Savvy Financial Advisor (the revised 2017 edition is now available), Marston teaches financial advisers how to best serve each generation. In advance of his keynote presentation at FPA Retreat, April 24–27, the Journal sat down with Marston to learn more about how to best connect with various generations and bridge generational gaps.
1. You are a leading expert on generational change. How are generational demographics changing the business landscape?
The senior generations, in both the workplace and the marketplace, are, in many cases, rightfully concerned about their ability to do business with the junior generations or their ability to hire, retain, and keep the junior members of the workplace fully engaged. The senior generation fears a new priority coming out of the junior generations that they don’t understand or that they can’t connect with and will struggle to provide the appropriate products and services to them. Or they fear a new priority coming out of the junior generations on how work is to be performed and completed on a daily basis, and that makes them unable to recruit and to retain them.
So the change is coming in two forms: the senior generations fearing a change coming that they don’t understand which, in itself, is driving change; and at the same time there is indeed some real change happening. And it’s a combination of the two that is causing businesses to reinvent how they recruit, how they retain, how they manage, and how they motivate.
I’m a big fan of podcasts. I listened to one yesterday about a company call center that decided to address burnout by creating safe spaces in their workplace. They created little cocoons off to the side of the call center floor where people could retreat after particularly difficult calls. Now, safe spaces get a lot of eye rolling from older generations. But this company created these cocoons to retain people, largely their younger employees. And, per the podcast, turnover in the call center is down dramatically. So, it’s working. This same company is also trying to understand the channels that younger generations will use to find products and services, and that’s causing the company to reevaluate how they bring their products to market. So there’s a lot of change being driven largely to accommodate the needs of the younger consumers and workers in the marketplace.
2. In your book, The Gen-Savvy Financial Advisor, you focus on three generations: baby boomers; Gen X; and millennials. If you were a financial adviser today in his mid-50s, and you were looking to substantially grow your client base, on which generation would you focus your efforts?
What my company knows about financial advisers is they typically do business with people who are 10 years older or 10 years younger than them. That means people age 45 and younger aren’t getting much attention from advisers. I would target that 45-year-old and younger age group, which is a Generation-Xer, because around age 50, people are entering their prime earning years.
We also know that if somebody is going to get any sort of inheritance, they get what we call the first sniff of it at about age 35. So there is going to be some affluent people out there 45 and younger who are receiving some wealth.
I also think that the Generation-Xer is overlooked in nearly every market and in every product. Most consumer product manufacturers seem to want that millennial right now. And they should; there are 93 million of them—they’re a huge marketplace. But the ones that go after the Generation-Xers will not be disappointed. I think they’re a target-rich audience.
At the same time, that adviser has a very steep hill to climb, because Generation X is a difficult audience. They have a distain for financial services. They feel, “I can do this myself; I’ve got access to robo-advisers.” But advisers will also find that that Generation-Xer is a very loyal client once the adviser has proven him or herself to be of value.
One way to reach Generation X is through events. For example, an event for a 45-year-old would be protecting your child from online predators and how to raise a child in a technology- driven environment. So much about raising children protectively while, at the same time, enhancing their experiences as a child will fall right in the lap of that 45-year-old. It will get their attention, they’ll want to come to the event and begin the conversation that would hopefully lead to a new client for that adviser.
3. What makes a financial adviser “gen-savvy”?
When they understand their own generational biases that come out of their coming-of-age years and how they are generationally unique. So No. 1 is self-awareness. No. 2 is how to transform their awareness into a connection with a member of a different generation. It’s the subtleties in how the different generations communicate, what they prioritize in their communications and in their relationships. Once that self-awareness happens, you become savvy to the other generational biases.
4. We hear a lot of broad generalizations about different generations, like boomers are loyal to their careers/employers, and millennials have a sense of entitlement. Are there generational stereotypes you believe are wrong?
Let me start by saying that I work hard to distinguish the differences between generalizations and stereotypes.
For example, baby boomers have this preference in the way they communicate, the way they work, the way they like to receive information, and the way they like to maintain relationships. It’s a generalization that leads to a preference. A stereotype, in the way I use the word, is a negative connotation, or a negative referral to a generation.
What I’m about to say to you are generalizations about these people, and you’ve likely seen them. However, you’re going to first want to test every hypothesis I give you to make sure it’s accurate with the person you’re dealing with. Don’t assume that because someone is born between these two years that these generalizations are going to be accurate for them. So there’s a difference between generalizations and stereotypes.
But are there stereotypes that are inaccurate? Undoubtedly, yes.
For example, one of my favorite ones to debunk is that Generation X (of which I am a member) were labeled as slackers early on. By no means is this generation a group of slackers. In fact, our research shows that there’s no generation to shoulder more responsibility for their own future than Generation X.
Another one is that millennials are job-hoppers, and baby boomers have never been such job-hoppers. Our research clearly shows that when the baby boomers were in their mid- to late-20s, they hopped jobs more frequently than the millennials do today.
Now, if we were to take a snapshot today, boomers in their 50s, 60s, and early 70s are not hopping jobs as much as the millennials are. But if we want to take five years of baby boomers in their 20s versus five years of millennials in their 20s, the boomers quit and left jobs much more frequently than the millennials do today.
5. What are some things financial advisers should know about successfully working with millennial clients?
First, most of them are asset poor right now; they simply don’t have a lot of resources. Second, they are very attuned to their parents. The millennials and their parents have a tight connection. A generalization is that they will listen to one another, which is an opportunity for a warm lead from baby boomer parents. Third, when you introduce yourself, put content on your website, or in any sort of promotional moment you get, you need to focus on the client and how they’ll change and benefit from working with you.
Fourth, millennials are easiest to work with in groups. They tend to like to be in groups of two, and three, and four. When calling on them or holding events, you want to make sure they come in pairs or in threes because they will much more likely show up than an individual who doesn’t know anyone at the event. So schedule opportunities for small groups of millennials to gather and hear your proposal or your information.
6. What about Gen X clients?
The apex consumer in Generation X today is the Generation X female. And when she is a mother of a young child, her decision-making and referral authority is unparalleled. Our society has given mothers of young children the ability to tell people what to do, what to buy, and where to shop in a way we’ve never seen before. So if I’m an adviser and I’m engaging a Generation X female with young children, I must treat her very, very well, because her ability to refer people to me is enormous.
Secondly, if she is married with young children, she is more often than not the CFO of her household. As much as the husband may act like he is the decision-maker, when the two of them are alone, she will determine whether I get the business or not, and she still has the power to refer. So when I’m dealing with Generation X, I’m keeping a keen eye out for the influence of the Generation X female. And my prediction is the millennial female will be exactly the same with a power of 10.
Know that the Generation-Xer is a “stalker.” Before ever meeting you in a business environment, they will have gone online and done a good bit of research on you. So to prepare for doing business with a Generation-Xer, make sure your online first impression is sparkling and squeaky clean. And in that online first impression needs to be some interesting personal information about you that makes the Generation-Xer nod and say, “This person sounds really interesting. I’m looking forward to meeting them.” I think one of the best tools in doing that is a good photograph. Not a good headshot, a good, interesting photograph.
You’ll also find that the Generation-Xer prefers email communication. It’s going to be casual. It will oftentimes have very few capitalizations. It’s a stream of consciousness email. They expect you to behave more like a peer and a colleague than a professional services provider. And when you find that to be the case, they will likely become a good client of yours.
7. What are some things that financial advisers should know about successfully working with baby boomer clients?
With baby boomer clients—largely again a generalization—the male is going to be the CFO of the household in these types of financial decisions. A distinction needs to be made between leading and trailing baby boomers.
Leading baby boomers, born 1946 to 1955, are the oldest portion of the baby boomers. Population-wise, they’re a smaller segment of the boomers, but their attitude is unique in that we appeal to the older baby boomers with messages of: you’ve worked hard, you’ve paid your dues, you deserve the fruits of your labor. The systems of the nation, Social Security, etc., were set up to reward you for the hard work you’ve done; let’s help you enjoy that through retirement planning.
They’re an altruistic portion of the baby boomers. Do you remember the “We Are the World” song? Those are all older baby boomers.
The younger baby boomers, born 1956 to 1964, are the more populous section of the generation. The great recession of 2008 hit them hard. They are of the age that many of their children should have been getting a toehold in their careers when 2008 came around, but due to the economy those younger boomers had to continue to supplement some of their children’s needs.
Bottom line, those younger boomers wear a brave face, but inside they are horrified at their retirement prospects. They haven’t saved enough. Their defined benefit plans have been frozen, eliminated, or were never offered to them. They’ve not taken advantage of the 401(k) plan—they realize in hindsight—the way they should have.
The adviser needs to go to the trailing baby boomers and give them a message of hope. Not a message of entitlement, or you deserve it, or you’ve worked hard, but a message of hope that is timely and personalized, which is: “There is still time to get you to this goal. We can create a plan that matches your need.” So the message for trailing boomers is personalized, focused, with hope, and no mincing of words. Say, “We must start this now.”
8. What advice can you offer young advisers of the millennial generation who are struggling to bridge the generation gap with Gen X and boomer clients?
First, I would tell them that there are few of them of their age, and they will become in demand in time. So message No. 1 is hang in there, demand for their services is coming. Their peers don’t have affluence right now, but when they do, their needs will be in demand.
Second, when you’re approaching the Generation-Xer or the baby boomer, you want to be careful of any sense of arrogance at all (and this is not just advice for millennials, but for all sales). Be careful of an arrogant attitude that could turn someone off.
You want to be the supplicant adviser. Your questions of the client or prospect need to be, “How can I help you? What info do you need?” Not, “This is what you should be doing.” Be a source of information, rather than the planner who’s going to get them where they want to go. Start off as the supplicant sales person asking, “What can I do for you?”
Third, I think many of the millennials who don’t have a story to tell yet, simply due to lack of experience and lack of time in the marketplace, need to get good at developing a narrative about themselves that speaks to credibility and doing something well that they’ve committed to. It’s an introduction that they give. An example may be something like: I went to college here and I learned the following things. And while I was there, I was a member of this club or organization, and I passed these exams. It should be a story that shows perseverance and prevailing over obstacles that gives the client an understanding that they may not have a background in financial planning, but they have a background in success. It’s only a matter of time before they become successful at financial planning; time is all they need.
9. Any given workplace could include four generations of workers—matures, baby boomers, Gen-Xers, and millennials. How can different generations successfully work together?
I’ll go back to one of the earlier answers. No. 1 is understanding your own generational preferences. Where those preferences came from, why they are what they are, and how those preferences influence your behavior in any given moment during the workday. Once you understand that, you can say to yourself, why do I do these things? Are these things helpful or just my preference? Could these preferences be getting in the way of a better-functioning workplace, and if so, I need to get out of my own way.
Secondly, try to teach others in your workplace their own generational preferences, so that they can get out of the way and make a more fully functioning workplace. There needs to be the understanding that we all bring these preferences and these preferences are not harmful; they have not been developed to bully people, they’re just simply the way we’ve evolved and these generations share these preferences. Once we’ve identified them, we can move them aside and make better, fully functioning, high-performing teams.
One of the workshops we give is understanding generational preferences in the workplace to create high-performing teams. Through that work, I think the key to that is empathy. Those empathetic people who can understand themselves can certainly understand the biases of other people. And if their focus is truly on the success of the team, and they get rid of their biases or they set them aside to allow for someone else’s biases, they will work well in any given situation and flourish.
10. You will be speaking at the FPA Retreat conference in April. What do you hope the advisers in attendance will take away from your presentation?
I know that these advisers have heard and read a lot about these generational differences in financial services. They have an extraordinary wealth of information on these generations already. So I ask them to take what they already know, set it aside as stuff that they can rely on, and open themselves up to the subtleties of the different generations to make them that much more effective.
What I’ll try to do is create what I call the last mile. I could show you data and statistics about generations and financial services—that data is everywhere and we use it a lot. But what I’m going to do is connect those statistics to new behaviors to better engage the workplace and present some ideas for new behaviors, new thoughts, and new processes to better engage the different generations in their marketplace.
Carly Schulaka is editor of the Journal. Contact her HERE.
Learn More
Join Cam Marston and other thought leaders at FPA Retreat 2017, April 24–27, 2017, at Château Élan located outside Atlanta, Georgia.
For the full conference agenda and online registration, visit www.FPARetreat.org .