Kids these days | The Millennial challenge

Business people around tableBy 2015, Millennials will equal Baby Boomers in the workforce. Very different in outlook and attitudes, the youngest generation in the workforce poses a challenge to older generations that lead most companies today.

A recent NICSA webinar looked at how this generational intersection is playing out in the investment industry. A panel of experts from Wells Fargo, DST Systems, and i4cp discussed traits that set Millennials apart and how Gen-Xers and Baby Boomers can work with this new generation most effectively.

Millennials in the workplace

Often dismissed as arrogant and entitled, Millennials need special understanding to bring out their true value in the workplace. “Kids” these days have a short attention span and are always connected to their devices. For older workers, this can present challenges. For example, it’s more effective to text rather than call a Millennial.

Here are additional pointers for older generations seeking to understand Millennials:

  1. They require constant feedback. Millennials want to know where they stand at all times. They don’t have patience to wait for review time.
  2. Millennials need to feel they are advancing. According to a recent Wells Fargo study, Millennials intend to work hard in a traditional career path.
  3. They don’t have a “pay your dues” mentality. They are focused on getting coaching, mentoring and development opportunities from superiors.
  4. Technology helps them uncover opportunities.  They can get and verify information at a moment’s notice. Ignorance is no longer bliss.

Millennials as investors and savers

Millennials also differ from previous generations in their views on saving, a Wells Fargo study found. Among key characteristics, Millennials:

  • Started saving for retirement in a work-based plan earlier than their parents by nearly 8 years. For those who aren’t saving, student debt comes first. Most don’t believe Social Security will be there for them.
  • Are setting aside more for retirement: 6-10% of income for the half who are actively saving. Understand the time value of money and compounding.
  • Are more conservative investors than prior generations. Tend to be less comfortable with stocks than Boomers.
  • Women are even more stock-shy. Two-thirds of women, as compared to one third of men, express lack of confidence in the stock market.
  • Tend to be more confident of achieving goals, but understand that time is on their side. 70% confidence can be attributed to youthful optimism.
  • Are more realistic about what they will need in retirement.
  • Have been heavily influenced by parents in thinking about finances. Nearly 80% credit parents on savings advice.
  • Go to parents, advisors and friends about equally for investing advice.
  • Are interested in advice from a seasoned advisor, but lack cash for fees.

How is your firm dealing with generational differences and encouraging engagement from Millennial workers? Please share your views with NICSA.

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