Millennials and Gen Xers want adviser help when inheritance hits, survey shows

Nearly eight out of 10 millennials and Gen Xers whose parents or grandparents work with a financial adviser and who expect to receive an inheritance are likely to seek professional help managing their money once they have more of it.

Millennials and Gen Xers may be more tech savvy than their parents, but a new study shows they plan to lean on the wisdom of financial advisers rather than their cell phones when they get their inheritances.

According to survey data released Tuesday by FreeWill, a social-good enterprise that links philanthropy and estate planning, nearly eight out of 10 millennials and Gen Xers whose parents or grandparents work with a financial adviser and who expect to receive an inheritance are likely to seek professional help with managing their money once they have more of it.

The study also showed that more than 70% of respondents would prefer to work with a human adviser rather than an automated service, and 73% plan to turn to a financial adviser as one of their first orders of business after gaining access to their inheritance.

The report additionally revealed that 66% of those surveyed are likely to stick with their parents’ or grandparents’ adviser, roughly matching the 69% who said they had already previously met with their family’s adviser.

Of the survey’s respondents, 60% expect to receive an inheritance of at least $100,000 and 39% expect at least $250,000. Meanwhile, 63% of respondents have an estimated current net worth of at least $100,000.

“We hear a lot of fear from financial advisors that younger generations might move assets away from traditional advisors en masse as they inherit from their parents and grandparents. Our research shows that this may not be true, especially when advisors are proactive about preparing for the transition of wealth” Jenny Xia Spradling, co-CEO of FreeWill, said in a statement.

As for how the millennial and Gen X generations plan to manage their money, the survey revealed their priorities as well. For example, when asked what they valued most in a financial advisor, 67% said getting the highest return on their portfolio, while 64% said personalized attention, according to the study. Avoiding high fees was cited by 45%, roughly the same as estate planning at 43%, said the report.

“Millennials and Gen Xers are facing a world where there are increasing pressures to juggle multiple roles that have grown in scope with each generation: professional, full-time parent, caretaker for family, advocate for both their financial and personal health,” said Mary Steele, managing partner at Freehold Wealth Management of Stifel Independent Advisors. “It is vital for their financial well-being to entrust some of that responsibility with an adviser. Inheritance is an even greater responsibility as it is one of the few times in life where a lump sum will be available to invest.”

“Our Gen X and millennial clients know they should be taking investing seriously, and they’re smart — they know what they don’t know — so there’s some fear about getting it wrong,” said Rachel Elson, a wealth adviser at Perigon Wealth Management. “Investors who are 35 to 40 have experienced three market corrections since they joined the workforce. Many want coaching and education from a trusted financial adviser.”

Finally, the data also showed that female respondents had different sentiments than male respondents in terms of managing their money. For instance, female respondents are less likely (60%) to have met with their family’s adviser than males (79%). Also, female respondents are less likely (54%) to invest their inheritance with an adviser than males (65%), said the report.