Fintech Insights

Managing multi-generational wealth with data-driven personalization

Mike Tropeano, CFA, Business Development Executive, Wealth Management & Trust, FIS

March 30, 2020

The largest wealth transfer in history is ushering in an unprecedented opportunity for growth for wealth managers. Income and wealth are shifting as the beneficiaries of trillions of dollars will have money to invest. In order to capitalize or even compete, it is crucial for advisers to nurture relationships with their clients’ heirs, while also attracting younger prospects

Historically, wealth transfers from one generation to the next have resulted in a change of advisers 50% of the time. To retain or capture a greater share of this wealth, a key strategy will be meeting the needs and understanding how to connect with all five generations (baby boomers, Gen X, older millennials, Gen Next and Gen Z). Firms that can effectively service the needs of all generations will be in the best position to grow their business.

Across channels and generations

Managing multi-generational wealth requires a mind-shift for advisers from focusing solely on an investor’s wealth to considering the behavioral patterns of that investor’s generation. To support this, firms need to prioritize data, automation, personalization and scale as effective enablers for mining new growth channels and serving multiple customer segments.

Technology is vital in aiding advisers in providing high-end digital investor experiences, obtaining deeper client knowledge, and delivering more personalized advice. Seventy percent of wealth clients state that digital will be their preferred channel for advice-related activities – strongly suggesting that the traditional model is changing and high-end digital experiences will become table stakes.

A strong data infrastructure can provide advisors real-time, predictive analytics in a single view so they can determine the next best action for the investor. It also allows for a flexible, digital ecosystem that provides personalized experiences, as financial goals generally differ by investor and generations. Older generations tend to think more long-term, while younger generations are more focused on the near term and experiences.

Deeper knowledge gleaned from data analytics can facilitate personalized services according to client profiles. A modern wealth management ecosystem, such as FIS’ Unity, provides wealth managers a unified front-office experience to better serve the needs of multi-generational investors. Leveraging innovations in artificial intelligence, data analytics and an open infrastructure supported by integrated workflows and document management, Unity provides a 360-degree view of the client’s personal balance sheet, including held away assets. This expanded wealth ecosystem brings together the worlds of banking and wealth, while capitalizing on predictive technology so advisers can make data-driven decisions

Today’s advisers can only win over tomorrow’s investors with a deep understanding of their goals and priorities. In a highly competitive market, a comprehensive wealth platform can provide advisers the tools they need to deliver real-time, predictive consultation and investment strategies –differentiating themselves from the competition and growing their business.