It’s a good time—and let’s face it a refreshing time—to think about the future of your business.

We’re talking about the younger guys and gals: Generation X (born between 1965 and 1982) and Generation Y, aka the Millennials, (born between 1983 and 2002).

First, let’s learn a little bit about what’s important to them. Full disclosure: Born to boomer parents, I am a (mostly) proud member of Generation Y myself.

The overarching characteristic that defines both of these younger generations is entitlement. They have more interest in spending their money on fancy toys than boomers ever even dared. Just think about all those iPhone-toting 20- and 30-somethings you see walking around. Those things are at least $400 a piece—and that’s just for the phone itself, much less the monthly bill, apps…well you get the picture.

But their entitlement doesn’t end with high-tech toys. It bleeds over into their careers, as well. They want high-paying jobs right out of school, and they wanted to be treated well, title and all. Forget the days of loyalty and tenure, these are people who plan to climb the corporate ladder by bouncing from job to job every 12 months—and to them, they have every right to.

This young group also values leisure above all else, preferring to spend less time in the office and more time with their family and friends. To them, traveling around the world while they’re young is more important than saving up for their next home.

So, now that you’ve had a brief glimpse into the minds of your future clientele—or maybe that of your firm’s successor’s—I have one mission for you: Kick that idealist reality right out of them.

As a planner, it will be your job to bring these new clients back down to earth. Make them understand that, unlike their parents, they don’t have any pension plans. They have 401(k) plans that they can—and must—start utilizing as soon as they enter the workforce. One key here: making sure they don’t empty that plan for “the big trip to India they can’t afford to go on otherwise.” This money is for their future, and it is your job to ensure they understand that, and act accordingly.

For many of these youngsters, reality will be a tough lesson to learn. Remember those boomer clients of yours who lost more than a quarter of their retirement savings over the past two years? Their children need to understand that that may mean those generous inheritances they’d been counting on are no longer a sure-thing. They need to save, and they need to start now.

Another key responsibility as the financial advisor of these clients will be to reprogram their view of the workplace. With an unemployment rate of more than 10%—and an underemployment rate that nears 20% and doesn’t seem to be dipping anytime soon—this is no longer a worker’s market. If they don’t want to do the job they’re being asked to do, someone else will. They need to be hard-working, loyal employees, and it’s your job to get them there.

And last, but by no means least, you are going to have give these little brats attention—a lot of it. Generations X and Y are known for their attention-hogging ways. After all, this is the Facebook generation. (One interesting tidbit: At the ripe old age of 25, Facebook Founder Mark Zuckerberg is too a member of Gen Y).

But a phone call once a month to ask how the dog’s doing isn’t going to cut it. Study after study has shown that these generations want to be heard—they want their opinions listened to and acknowledged. Remember what I said in my last column about asking clients the three things they want to talk about at the beginning of each meeting? These are the people who this truly rings true with.

Now some planners will look at this column and say, “this is easy.” But consider this: A new working whitepaper by Harvard professor and top behavioral economist Sendhil Mullainathan reveals that planners placate their clients to gain their trust, instead of telling them what they need to hear.

For his report, Mullainathan sent four actors, armed with four different portfolios, in to meet with advisors in the Boston area. One portfolio was heavily invested in index funds, one entirely in cash, one actor said he was looking for the next hot sector and another said he held 30% of his savings in company stock. In nearly every instance, the advisor gave advice that aligned with the portfolio he was presented with.

In essence, the advisor only reinforced the bad behavior. Mullainathan’s refers to this as “the yes-man problem.”


So yes, this is going to be difficult. And yes, it will be hard to simultaneously reprogram these entitled young chaps, while also ensuring them that they can trust you with their financial lives. But you can’t be a victim of the “yes-man problem.” You will have to learn to say no—the future of your business depends on it.

Read more In the Game columns here and some of our other columns here.