The popular narrative for Millennials has been largely negative when it comes to financial matters. Also known as Generation Y, this group is consistently painted as being poor at saving, unprepared for adult financial responsibilities, and highly reluctant to engage with the stock market.
On its face, this negative perception is unsurprising. Millennials graduated into a world driven by the 2008 financial crisis, and they did it saddled with unprecedented levels of student debt. However, TD Ameritrade’s 2016 Millennials and Money report reveals that the popular narrative doesn’t tell the entire story. In fact, Millennials may be even more committed to making smart financial decisions than previous generations, making them far more likely to need professional accounting advice to ensure success, both personally and professionally.
Millennials in the Workforce
In 2015, Millennials overtook Generation X as the largest generation in the labor market. By 2020, consulting giant PricewaterhouseCoopers predicts that they will make up at least 50 percent of all global employees. As the younger generation rapidly gains traction in the workforce, its members are taking on the roles of middle and senior managers – along with related financial concerns. This marks a clear opening for the accounting industry.
The Millennials and Money report highlights opportunities for outsourced bookkeeping services and controller services to capture this potentially lucrative customer base.
Financial Advice for Future Security
Three in five Millennials say that it’s important to start saving early, and most expect to set financial goals for life by the age of 27, which is nearly 10 years earlier than Baby Boomers. Notably, even with their historic debt burden, 80 percent of Millennials have already started setting a budget, compared to only 60 percent of Baby Boomers.
This focus on planning for a secure future carries over to business-related activities. Millennials are prepared to create and manage to both short- and long-term financial goals, however they are currently performing much of this work independently. As a group, they are hesitant to seek professional advice to support a successful, secure future for the organization.
These facts paint the story of a generation that puts a high value on effective budgeting and saving but isn’t yet convinced that professional advice is necessary. However, the data show that nearly 70 percent of Millennials say financial security is very important, which indicates a clear opportunity to convince the generation that professional accounting services are necessary.
Financial services providers will have the most success with Millennial leaders when they demonstrate the importance of planning ahead for the organization’s future financial security. Drawing parallels with personal financial security will highlight the benefits of bringing disciplined personal financial habits to the business world.
Using New Technology to Market to Millennials
Millennials are the first generation to grow up with digital technology, and many are more comfortable with electronic communication than they are with face-to-face meetings. Millennials are 10 times more likely to use financial apps as compared to Baby Boomers, and they consistently prefer an online component to financial services. Notably, more than 40 percent of Millennials would be “confident” using an entirely automated online platform for investing and other financial services. Most indicate that ideally, financial services providers will offer a mix of online and in-person support.
The use of technology in marketing and providing services is the most effective method of making inroads with this demographic, and accountants who can meet this deep desire for technology are likely to have success with selling their services to Millennials.
As this generation becomes the driving force of the business world, outsourced bookkeeping and controller services must adapt to the new market. By taking advantage of Millennials’ appreciation for planning and financial security, as well as the new digital tools specifically designed for convenience and simplicity, financial services professionals have an opportunity to gain the trust of a new generation of business leaders.