Best known for its vibrant night life and music scene, New Orleans is probably the closest thing to an adult Disney World. For financial advisers, though, the city is home not only to Bourbon Street, Mardi Gras and Jazz Fest but also to a growing roster of opportunities with the next-generation crowd.
Over the past several years, New Orleans has seen a surge in the number of relocating 20- and 30-somethings. The Gen X and Gen Y set — which makes up a little less than one-third of the New Orleans population, more than the national average of 26%, according to the U.S. Census Bureau — has helped transform New Orleans into the country's fastest-growing metro area. The city posted population growth of 6.9% between 2008 and 2011, compared with just 2.5% for the entire U.S.
“There's been an unbelievable influx of young people,” said Renee Pastor, managing director of the Pastor Group at Raymond James | Morgan Keegan.
RELATED ITEM RIA rankings for Lousiana
It's a sorely needed demographic boost for the Big Easy, which is still dealing with the effects of Hurricane Katrina, seven years after it caused devastating destruction and sent the city into an economic tailspin.
Much of New Orleans' recent growth can be attributed to a refilling of the population after the mass exodus following Katrina. The labor force fell from 202,000 in July 2005 to 100,000 in July 2006, according to the Census Bureau.
“Our lives are defined by before the storm or after the storm,” said Ms. Pastor, who has lived in New Orleans for almost 35 years and has been an adviser for 23.
Pre-Katrina New Orleans was home to a thriving energy industry that provided financial advisers with an abundance of high-net-worth clients. The downside to the youth movement is that it doesn't come with high salaries and the most appealing prospects — at least not yet.
The 2011 median household income for New Orleans, $35,041, is significantly lower than the U.S. median of $50,502, according to the Greater New Orleans Community Data Center.
“For advisers who are established, the money's not quite there yet, but there's good seeds for the future,” Ms. Pastor said.
Blair duQuesnay, 30, an investment adviser representative at Ferro Financial LLC, is pursuing younger people aggressively, even if it means charging hourly fees to get them comfortable with her and to ensure that she stays on their radar.
“It's a very good spot for me,” said Ms. duQuesnay, who moved to New Orleans two years ago after living in New York City and Atlanta. “We work with a lot of young people. There's a very large and growing entrepreneur group here.”
The startup-focused blog Under 30 CEO named New Orleans the best city for entrepreneurs in 2011.
Younger people present an adviser with another challenge: convincing them that they need you in the first place.
“The cost of living is so low, a lot of people don't think they need an adviser,” Ms. duQuesnay said. The key to success is finding the right niche, she added.
“You've got to have a target market,” Ms. duQuesnay said. “You can't just go about things as you would elsewhere. New Orleans has a lot of money that's been passed down, and families use the same institutions to manage it.”
To help position herself to meet potential clients, Ms. duQuesnay is active in the community as a member of the Junior League of New Orleans and the Louisiana Society of Security Analysts. (Another organization is the 95-member Financial Planning Association of Greater New Orleans.)
Advisers focused on retirees or the soon-to-be retired may have it a bit tougher. Just 11% of the New Orleans population is over 65.
“Those of us who target the rollover market are having to deal with a smaller market,” Ms. Pastor said. “A lot of people are delaying retirement.”
Something that should help attract seniors is the recent elimination of Louisiana's inheritance tax and forced heirship. Before that move, estates had to be left to children.
The city is also working hard to entice higher-paying jobs. One of the state's biggest post-Katrina initiatives was creating the Greater New Orleans Biosciences Economic Development District. Known as BioDistrict, it is tasked with helping expand the city's health care and biosciences industries. Two new hospitals, the $1.1 billion University Medical Center and the $995 million Veterans Affairs hospital, are under construction and should attract well-paid health professionals to the area.
Louisiana also has the movie industry in its sights. The state began allowing a number of tax credits to filmmakers who shot there after Katrina. Between 2008 and 2010, an average of nearly 100 films a year were made in Louisiana, up from just 33 annually from 2002 to 2007.
“They've started calling us Hollywood South,” said Ms. Pastor, who has a kind of warning for those who plan to visit New Orleans.
“It's unbelievable how many people came to help after Katrina and are moving here because they've just fallen in love with it,” she said.
firstname.lastname@example.org Twitter: @jasonkephart