By Maurizio Kaiser, co-founder of ikigai, raising on Crowdcube
For many years, the word “millennial” has been synonymous with “the young” – and yet, millennials today (defined as those born between 1981 and 1996) are now in their late twenties and thirties. The oldest are hitting their forties.
They’re not just coming of age, they areof age: working harder, acting smarter, facing vastly different challenges than other generations. What’s more, they are increasingly of stature in politics, culture and across professions – they’re CEOs and rising artists, leading teams and driving change across business and society.
For banks and wealth management firms alike, the rise of the millennial represents a crucial opportunity.
Not only digitally native and forming the majority of today’s workforce, there is a growing cohort within the millennial generation who are not only affluent in their own right, but are about to become the beneficiaries of one of the greatest wealth transfer in history. According to Simon Kucher & Partners, by 2046 baby boomers (those born between 1946 and 1964) will have transferred USD30 trillion of their wealth to the next generation.
There are already over 2.4 millionyoung but affluent millennials in the UK – but that number is increasing. As they enter their prime earning, inheriting, and spending years, these millennials – the young affluents – are the future clients that banks and wealth managers must work hard to not just attract, but retain. And that means addressing a swathe of currently unmet expectations.
Underserviced and overlooked
Despite the size and potential of the young affluent audience, the financial sector in its current guise is not meeting their expectations.
When it comes to wealth, incumbents and challengers alike favour a one-size-fits-all approach, meaning that there are a growing number of young and affluent people who are currently overlooked by banks.
Research backs this up, with data showing that 56% of high-net-work millennials in the UK are dissatisfied with the wealth management tools on offer to them. They seek a financial solution which is personal, accessible, high-tech and high-touch – but they’re not finding a service that meets these needs amongst the current market offering.
Unsurprisingly, this dissatisfaction shapes their behaviour; 60% of millennials say they’re not loyal to their current wealth management service.
So where’s the disconnect?
Crucially, young affluents recognise how important their relationship with money is. Unlike previous generations, they approach their wealth as an act of self-care, rather than avarice, which makes them both more financially conscious and financially cautious.
With this in mind, there are a number of consequences that shape young affluents’ requirements from a bank.
Firstly, they want to approach their personal finances and savings goals from a place of mindfulness and intention, with accumulation no longer the sole focus. Accenture’s ‘Millennials & Money’report found that 59% of millennials want to become savvier with cash flow management and budgeting, as well as planning for specific events.
Secondly, young affluents want their wealth to meet their sense of purpose. They believe – as I do – that your money should help you achieve your goals, not be the point of stress that it all-too-often becomes.
That’s where ikigai comes in
At ikigai, we’re on a mission to help this under-serviced but increasingly powerful audience, by building a financial platform for the future of wealth.
We want to redefine the way young affluent people bank and invest by approaching personal finance from a personal place – an approach to money that, as explored here, we believe escapes incumbents and challengers alike.
As for why we’re taking this challenge so seriously?
With ikigai, we believe there is a clear opportunity to redesign banking and wealth management from the ground up. We’ve created a product where our clients’ wealth meets their sense of purpose. And we’re inviting you to join us on our mission.
If what I’ve shared here resonates with you, and you’d like to join us on our journey to redefine the way young affluent people bank and invest, I’m pleased to offer you the chance to become part of our community.
ikigai’s crowdfunding is now open with exclusive early access.
To invest in us on Crowdcube, and to find out more, head here.
Investments of this nature carry risk to your capital and should be invested in as part of a diversified portfolio. Please Invest aware.