Why You Should Be Educating Your Wealthy Clients’ Kids
Large wealth managers are hosting financial seminars for the children of their rich clients in the hopes of one day winning the heirs’ business, Reuters writes. But it may take more than simply hosting courses, according to the newswire.
Wealth management giants such as Morgan Stanley, Bank of America, UBS Group and Citigroup are having trouble luring millennials, Reuters writes. Between them, these firms already control $17 trillion, or 10% of global wealth — but only 6% of millennial wealth is at private banks, according to Boston Consulting Group data cited by the newswire.
Millennials are expected to control $35.3 trillion – or 16% – of the world’s wealth by 2020, according to BCG, and the big wealth firms are hoping to lure some of it by warming up to their rich clients’ children, Reuters writes.
Morgan Stanley hosts summer events with titles such as “Time for a Prenup?” offered to millennials whose parents invest at least $20 million at the company’s Private Wealth Management unit, according to the newswire. The private bank arm of Citigroup, meanwhile, this year hosted such events on three continents, Reuters writes. But it’s not enough to merely offer a “boot camp” to gain millennials' trust, Money Kanagasabapathy, global head of next generation programs for Citi Private Bank, tells the newswire.
“You have to really inspire them and hope that they at least continue having the conversation with you,” Kanagasabapathy — who goes by the moniker Money K — tells Reuters.
Worldwide, those with $30 million or more in net worth held $9.6 trillion in cash in 2016, which represents 35.4% of their wealth and the largest share of their holdings, according to the report.
The bright side, at least for wealth managers holding seminars welcoming rich millennials in New York, is that the metropolitan area’s ultra high net worth population grew 9% last year, to 8,350 individuals. Worldwide, meanwhile, the global ultra wealthy ranks are expected to grow by about 25% by 2021, according to Wealth-X.