A blog post for Financial Professionals
I'm sorry to use the Sound of Music to lure you in. In this instance, Maria is 23yrs old and wants Investment Advice - how do we give that advice to the 18-30 year olds, or do we allow Social Media to dictate the narrative? Helena Wardle - A Senior Partner at Smith & Wardle LLP has been looking at this for a while. Helena decided to pop this into my head and see what I could come up with - so here I am, asking for a discussion and nothing else. This blog represents my thoughts and the reactions I've seen. No one else is to blame!!!
The 'Icarus theory' ("I keep buying stocks as they go up and just when I think it's going to fall, I sell out" boasts one Tik Tok investor) is an interesting one I've seen and absolutely blasted by Financial Advisers. Perhaps they will go to Bitcoin - another investment blown to bits by advisers. I have also read an Investment Firms' paper, where an Investment Manager wrote a 16 page article on it, explaining how they saw it as speculation and not investment.
So, reasons why not.
We could point them to Nutmeg, Moneybox, Boring Money, Hargreaves, AJ Bell Self Invest and a plethora of other places, but equally it seems, we are keen to point out the costs, charges, no advice etc etc on this too.
Our 18-30's are used to monthly payment plans/subscriptions - From Fitness to food, to cabs and clubs -it's all pay monthly.
In the main, we see an 18-30yr old by way of introduction from Mum and Dad whom we've given advice to for years and as part of the service, we'll set up an ISA, Pension etc.
But what about a direct service to them? our initial advice fee - be it fixed or percentage - in my opinion - will not work. They may want to start paying £150p/m into an ISA for example. Would we have to go back to 'Nil Allocation' for a year or two, to cover the initial fee? Or ask them to pay another £150 per month to cover it?
We know there are funds that are cost effective - platforms too, but how do we get involved? how can we fit into that 'monthly payment plan' for advice and education?
If we could, a client wouldn't be with us for just for 20-30yrs, but potentially 50 or 60 years and beyond as we repeat the process for their children.
So my discussion point is this - How can we do it? The benefits are massive. With education, we can help our young clients avoid scams, which will have obvious benefits to our profession as well as those of our new and existing clients.
We build potential longevity into our businesses, securing clients for the very long term and that will of course, mean greater value in our business for us while we are in our business and for when we decide to exit.
Or do we keep pointing them to the aforementioned places, only to point out the shortcomings?
How do we solve a problem like Maria?
