Generation Z, the age group born after millennials, has often been called the most diverse generation in U.S. history. People who fall in the Gen Z group were born starting in the mid-90s to the early ’00s. Savers at heart, they’re going to college, getting their first jobs and looking for smart financial advice.
They might be young, but with $44 billion in purchasing power, they’re an important client base for financial professionals to begin cultivating. Currently, they make up around 32 percent of the population and are poised to edge past millennials as soon as next year Opens in a new tab.
Here are seven tips you should know as you prepare to serve Gen Z clients.
Gen Z loves their computers, iPhones and iPads. Most of them own a smartphone and spend at least four hours a day online, according to one study Opens in a new tab. In order to both attract Gen Z clients to your business and serve them effectively, you need to provide online services that keep them connected to their money and to you, such as online chat technology, virtual meetings and apps that will help them manage their money and investments on the go.
Gen Z sure knows how to save, and they’re starting early. In fact, Gen Z is saving money at a higher rate Opens in a new tab compared to previous generations for goals like a car, mortgage or college. This generation will be turning to you to help them determine how much they should be saving from their paychecks so that they make progress toward their goals.
Gen Z wants to make investments that can help make a difference in the world, such as helping in the fight against climate change. A study by Swell Investing showed that 84 percent of Gen Z is interested in socially responsible investing (SRI). Gen Z is deeply motivated to tackle these types of big challenges. Politics, environmental concerns and a sense of responsibility have all greatly shaped their approach to money and investing.
Yes, this generation is still very young, but they’re already thinking about retirement. Many of those in Gen Z are planning to start saving significantly in their 20s and have income of their own, according to one study. Gen Z has learned lessons from their older relatives who went through the Great Recession and the student debt crisis, so it makes sense that they would prioritize planning for retirement. They want to make sure that they have enough money for life far down the road. In any conversation you have with a Gen Z client, be sure to acknowledge retirement planning – they’ll appreciate it.
As of March 2019, Americans owed $1.5 trillion in student loans. Gen Z has seen what this has done to their millennial friends and family, and they don’t want to suffer the same way. They’ll be looking to you as their financial professional to help them manage this.
While digital experiences are important to Gen Z, those in this age group don’t want to feel like a commodity. If you’re interested in winning over your Gen Z clients and building loyalty, find out what you have in common and use this to connect with them. Practice your listening skills. This will go a long way toward cultivating meaningful interactions. Ask questions. Dig deep to find out what your client’s sense of purpose is. Gen Z has strong opinions on work. Many want their day-to-day life to be fulfilling, not just about a paycheck.
According to a Defy Media Acumen Survey survey for Adweek, 95 percent of Gen Z watches YouTube and around 50 percent say they can’t live without it. With that in mind, you may want to brainstorm ways to use this medium. For example, you might consider advertising your services there. Or you could create educational videos on YouTube to share on your website or social media channels. No matter how many of these tips you decide to implement, remember this: What you did to market your services and your firm in the past to baby boomers and other generations may not be as effective with Gen Z.
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