4 things you should know about advice for Generation Z

Alex Burke,  Senior Writer,  No More Practice Education

Speaking at the Financial Services Council Summit in Sydney, Student Super chief executive Andrew Maloney discussed the unique circumstances in which the so-called Generation Z finds itself. 

Born after millennials (from 1995 onwards), Gen Z’s “lived experiences are different to other generations’ lived experiences,” Maloney explained. 

This, he said, is for four key related reasons:

A different pathway to wealth

Maloney said Generation Z are going to “soon discover property isn’t the answer to building wealth anymore.”

“Property may not be the amazing rise it’s been on,” he continued. “It can’t keep growing faster than GDP forever. They’re going to have to make money another way. Their path to wealth is going to be unique compared to the last three generations.”

Lower incomes

Aside from property cycles, this also comes down to the fact that they’re making less money. “30 years ago,” Maloney said, “I used to get paid $23 an hour. Now I see interns getting paid $23 an hour, and I think, ‘My experience was 30 years ago!’ It’s a tough time to be a young person.” 

“A lot of universities boast about how 70% of students have a job within 12 weeks of graduating and 90% between 12 months of graduating,” he added. “Flip that around –30% are still unemployed 12 weeks after graduating, and 10% are still unemployed after graduating? And they’re proud of that?”

He said this was a “terrible result,” and that “the traditional pathway to getting a job has changed – there’s lots of talk about side hustles, for example.”

Reliance on parental guidance

Another issues advisers will need to contend with regarding Gen Z is the effect of parental influence. “I don’t want to sound rude,” Maloney said, “but my relationship with my parents was somewhat antagonistic. But now, Gen Z are all friends with their parents. That’s a good thing, but there is an economic incentive there. If you don’t get on with your parents, where are you going to live? 

“The direct takeout for advisers here is that they usually won’t make a move without first talking to their parents. We do a brochure and we hand it to school kids – it’s called, ‘Mum, check this out.’ We try to encourage that discussion through the parents.”

Not all tech is created equal

Finally, despite endless press coverage about kids and their dang smartphones, Gen Z aren’t going to be attracted to a particular adviser just because they’re online.

As Maloney put it: “So, what, you got an app? Everyone has an app. There are no brownie points for having cool tech. Why? Because your benchmark isn’t against other super funds; it’s against Apple.”

That doesn’t mean technology is irrelevant, though – rather, financial services companies should focus on technology that actually services the needs of their customer-base. “Our great tech,” Maloney said, “is knowing our customer better than anyone else. So, when you log into your app, what are you looking for? And they say, ‘I’m always looking for that damn member number. I can never find it and I have a new job. And I wouldn’t mind seeing my balance.’ So we put that at the top. Sometimes it’s the simple things.”

 


The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice Education Pty Ltd or its related entities. All content is intended for a professional financial adviser audience only and does not constitute financial advice. To view our full terms and conditions, click here.

Liked this article? Let us know

Want more of the latest in opinions, expert insights and training?

Subscribe to our free eNewsletter now

/ Related content

How will advice pricing models need to change?

FPA CEO Dante De Gori has some ideas.

ASIC just released some concerning advice research

A new report by ASIC sheds light on the main obstacles the advice indust....

Are Indigenous clients under-served by advice?

LGIAsuper chief executive Kate Farrar discusses her experience with Indi....

Leave a comment /

Related content /

26 August, 2019

Alex Burke,Senior Writer,No More Practice Education

ASIC just released some concerning advice research

A new report by ASIC sheds light on the main obstacles the advice industry faces. 

Read now

20 August, 2019

Alex Burke,Senior Writer,No More Practice Education

Are Indigenous clients under-served by advice?

LGIAsuper chief executive Kate Farrar discusses her experience with Indigenous super members and their common advice needs. 

Read now

WordPress Lightbox Plugin