Arming clients with the tools to teach kids about finances

Advisers are reaching out to the next generation through their parents

Apr 5, 2019 @ 4:48 pm

By Thomas J. Henske

Advisers have a unique opportunity to make a difference in the way our country approaches the development of financial literacy.

On the surface, endeavoring to help young people (Ages 6-20) develop a basic understanding of money concepts does not seem to be an agenda item that can realistically get traction in an already chaotic world of financial advice practices. When you contemplate adding yet another item to your to-do list, a list that already includes: client meetings, paying careful attention to economic markets, products, tax law changes, compliance, new client prospecting, networking, etc., it amounts to a Herculean task to now take on educating your clients' children about money.

Such an endeavor doesn't seem doable — or profitable. But what if you were able to build deeper relationships with your clients?

If you could just find a way to engage your current clients in a values-based discussion about their children's education as it pertained to money. Imagine you could do this without having to actually meet with the child and still get value-added points that separate you from your competitors.

(More:Advisers can increase business while boosting financial literacy)

It's the type of conversation that your current clients are having with their friends — you know, those people who you are hoping your client will refer to you. For the majority of our clients, the three things that are most important to them are their 1) health, 2) wealth and 3) kids, and not necessarily in that order. That is what they talk about in their tight social circles — a conversation you would like your name included in.

You want your clients to be out at dinner with another couple on Saturday night talking about how their financial adviser is arming them with tools and resources to help educate their kids about money. You hope that the other couple (your prospect) is saying to themselves, "Why doesn't our wealth management company do that for us?"

Without giving away our secret sauce, Lenox Advisors sought to do this for our clientele by developing age-based lesson plans that we put in front of clients on an annual basis (depending on the client's interest). They give parents a clear, easy to follow, blueprint of the lessons they might want to go through with their children to make sure money conversations are happening in their own households.

This lesson could be as basic as teaching a 6-year-old the difference between pennies, nickels, dimes and quarters, or, it could be as robust as starting an allowance program with a12-year-old. It could eventually morph into budgeting for that 16-year-old's car, gas and insurance money.

It doesn't take a lot because the lessons are very basic and more just a tool to have a conversation begin in the home between a parent and child. One of the most important parts of financial literacy is for a family to help their children understand the values that surround the money decisions that they make.

(More:Financial literacy: An epic fail in America)

Where a family spends their money is a huge tell of what they value. Assuming that children will just pick up these lessons by osmosis is a risky, if not careless, strategy.

The adviser community has a wonderful opportunity to build lifelong relationships with clients by showing a genuine interest in the betterment of those client's children. Not only is doing so an unbelievable client retention strategy, it will make you feel like you are giving back and attracting other like-minded clients to want your services.

Thomas J. Henske is partner with Lenox Advisors in New York.


What do you think?

View comments

Upcoming event

Sep 10


Denver Women Adviser Summit

The InvestmentNews Women Adviser Summit, a one-day workshop now held in six cities due to popular demand, is uniquely designed for the sophisticated female adviser who wants to take her personal and professional self to the next level.... Learn more

Most watched


Finding innovation in your firm

Adam Holt of AssetMap explains how advisers understand they need to grow, but great innovation may be lurking right under your nose.


Finding your edge from Tony Robbins

Guru Tony Robbins has helped a lot of people, but armed with his psychology Financial Advisor Josh Nelson has helped his practice soar.

Latest news & opinion

Tony Robbins loses role with RIA amid charges of sexual misconduct

String of allegations costs the self-help guru his gig as chief of investor psychology at Creative Planning.

SEC sets June 5 date for vote on Regulation Best Interest

Commission adds new item to agenda: Interpretation of broker guidance that qualifies as advice

House passes SECURE retirement bill with massive bipartisan support

The measure allows small employers to band together to offer plans and raises the RMD age. Another provision eases use of annuities in 401(k)s, which critics say goes too far

10 IBDs with the most annuity revenue

Here are the independent broker-dealers that brought in the most annuity revenue last year.

DOL sets date to propose new fiduciary rule

The regulation, expected in December, likely will be contoured to the SEC's new advice standards.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print