HOLLYWOOD, FLA. -- To attract the next generation of affluent investors, advisors must adapt their thinking about today's "modern family."

In a nutshell, Kim Dellarocca, Pershing's head of practice management and segment marketing, said advisors need to get rid of their stereotypes.

Today's modern family no longer primarily consists of married, heterosexual couples with two or more children, Dellarocca said at Pershing's 2013 Insite Connference on Thursday. Today, 51% of Americans are single, many women are the sole or primary breadwinners in their families, and same-sex marriage is now legal in 10 states. It's also now estimated that racial "minorities" will become the majority in the United States by 2042, Dellarocca explained, citing U.S. Census data. 

Dellarocca urged advisors to do the following, detailing findings from a new Pershing report titled "Investor of the Future: The Quest for Tomorrow's Affluent Clients Must Start Today." 


Advisors' perceptions of their client-base versus the actual affluent market profiles of these groups are often misaligned, Dellarocca said.

Pershing's report, compiled from surveying hundreds of advisors from RIAs, wirehouses, broker-dealers, and banks, found that advisors overall believe their affluent clients skew significantly more Caucasian, are somewhat older and are much more likely to be married compared to the broader market. However, minority groups, younger investors, and women are all growing percentages of the affluent market, with burgeoning economic influence.

"Advisors have an opportunity to attract culturally sensitive advisors and train existing advisors in serving minority groups," the report said. 


Advisors are missing out on a huge opportunity to retain clients, the report concluded. According to Pershing's research, even though more than half of clients considered to be affluent have children 18 years and older, advisors have only spoken with about 35% of this investor group about their finances or future investments.

Only 52% of advisors offer expertise in intergenerational wealth transfer and less than half offer expertise in trust services. 


Over-diversification is not necessarily effective, the report warned. Instead of being unable to meet client expectations by spreading their business around too many market segments, Pershing suggested advisors specialize on a few key sectors. This will help advisors distinguish themselves from competitors, the report says. 


  • Start establishing yourself as a champion of financial responsibility when children are young. Send information and engage in activities that are age appropriate. For example, send school-age children a book about the concept of money to help them start a savings account. 
  • Take steps to gain accounts with clients' adult children.
  • Choose a market or markets that you want to specialize in -- such as families with special needs or divorced individuals.
  • Identify the precise knowledge, expertise and designations you will need to be effective, such as earning a Certified Divorce Financial Analyst designation. 
  • Recruit a more diverse team and encourage learning or increasing proficiency in another language.

Read More: Why the Industry Needs More Women Advisors



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