Millennials are seeking investment advice in considerably different ways when compared to other generations. A survey conducted by Crealogix has revealed the different perceptions of traditional wealth management services across generations.

Provider of digital banking solutions, Crealogix conducted an independent survey of 1,200 UK consumers. Interestingly, the survey identified that over 41% of millennials seek investment advice from their family above any other option. Moreover, only 30% of respondents said they would seek investment advice from a bank. Additionally, only 19% identified wealth management services. This is striking given the range of apps and digital services that banks and wealth management firms offer, encouraging investment. Despite digital services rendering investment management more accessible than ever, a family is still the first port of call.

Furthermore, the survey identified that younger investors seek advice from a more varied group of sources.

Of the millennials surveyed, 50% turn to family for investment advice, whereas 25% seek advice from their bank.

It has become apparent that this trend inverts as investors get older. In fact, 22% of baby boomers ask family members for investment advice and 35% opt for their bank.

Interestingly, the survey has revealed why there may be a general reluctance to turn to wealth management firms. Of the consumers surveyed, 19% branded wealth managers as “elitist”. Likewise, 18% have said the industry is “old-fashioned”.

Commercial Director at Crealogix UK, Jo Howes, has commented:

“There appears to be a misconception that bank savings accounts are the best safe choice for big investments, which is untrue. Wealth management services are falling behind in educating their clients about other low risk investment options which have a better chance of protecting savers from the effects of inflation.”

“Risk-averse, long term savers are just one of several market segments where wealth managers have the opportunity to compete more proactively with banks to attract new consumers and their investments. By educating people about how to make smarter use of their money, the wealth management sector can regain trust and reputation.”

“Digital wealth management technology offers wealth management firms a great new set of opportunities for engaging consumers and helping them manage their money better.”

Millennials are twice as likely to invest via an app, according to the survey. In fact, today there is a wealth of apps designed to educate and encourage new investors.

Moreover, Anton Zdziebczok, Head of Product Strategy, added:

“Providing digital wealth management services allows established firms to appeal to younger generations and gain much better scalability as they onboard new clients. Financial institutions don’t need to build everything in house.”

“There’s plenty of expertise on hand in the UK, once wealth managers commit to a digital strategy. With the ecosystem of specialist software providers and fintechs expanding rapidly thanks to the open banking movement, there’s never been a better time for wealth management firms and financial advisors to reinvent themselves.”

With the growing technological advancements, perhaps wealth managers should commit to offering more digital alternatives to attract younger investors. However, they would still be competing with family members as the top investment advisors for young people.