Preparing for the Next-Gen Client Base

1© 2018 |www.nicsa.org | #WebinarWednesdays
Preparing for the Next-Gen Client Base
Sponsored by:

2© 2018 |www.nicsa.org | #WebinarWednesdays
Panelists
Linda York
Senior Vice President, Cogent Reports, Market Strategies International
Matt Schiffman
Principal - Distribution Insight at Broadridge

Understanding
Affluent Millennial
Investors
Highlights from annual research findings
February 6, 2019

4© 2018 |
Methodology
Cogent Reports uses market-sizing incidence survey findings, which are weighted to US census
data, to develop quota targets followed during fieldwork. We apply minimal statistical weighting
post-fielding. As a result, the data reported in this study are representative of the affluent
investor universe.
Mode Web survey conducted June 25 to August 7, 2018
Survey length Approximately 30 minutes
Population Investors with $100,000 or more in investable assets
Sample size 4,373 affluent investors
Sampling error ±1.48 percentage points
Generation Age range in 2018 Sample size Weighting
Millennial (1982–2000) 18–36 387 14.6%
Generation X (1965–1981) 37–53 981 26.0%
2nd Wave Boomer (1956–1964) 54–62 975 20.5%
1st Wave Boomer (1946–1955) 63–72 1,500 28.7%
Silent Generation (1924–1945) 73–94 530 10.3%
Number of actual
respondents
% of analyzed
responses
(weighted)
Sample of Distribution of Affluent Investors by Generation
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5© 2018 |
More than one-third of US adults are affluent investors
• Millennials represent 15% of the total affluent investor population and nearly 20% of
affluent investors with $100k-$500k in investable assets.
S1. In what year were you born?
S7. Which of these categories includes your total household investable assets?
Base: All Affluent Investors
▲/▼ = Significant change from stated year
/ = Significant change observed in 2017 sustained in 2018
Source: Market Strategies International. Cogent Reports™. Investor Brand Builder™. October 2018.
Mean age
2018 55.2
$100K–
<$500K
52.6
$500K–
<$2M
58.8
$2M+ 58.3
15%
18%
10%
14%
26%
32%
19%
17%
20%
18%
26%
17%
29%
25%
32%
34%
10%
7%
14%
17%
AFFLUENT INVESTORS BY GENERATION
Millennial Generation X
2nd Wave
Boomer
1st Wave
Boomer
Silent
Generation
18–36 years 37–53 54–62 63–72 73–94
’16 ▼’17 ▲’16 ’16
’16 ’16 ’16▲’16
▲’17’16 ▼’17
▲’17
▲’17’16

6© 2018 |
Fewer affluent US adults work full-time for pay
• With more Millennials shifting to part-time work, fewer affluent investors work at least 40
hours a week than in past years. Notably, business ownership among affluent investors is up
significantly compared with 2017, driven by Millennials.
Q10. On average, how many hours per week do you work for pay?
Q11. Do you…?
INVESTOR EMPLOYMENT, BUSINESS OWNERSHIP, HOMEMAKER AND RETIREMENT STATUS
Total Millennial Gen X
2nd Wave
Baby
Boomer
1st Wave
Baby
Boomer
Silent
Generation
Hours Worked Per Week for Pay
40 or more 53%▼’17 68% 49% 15%▼’16 2%
21–39 31%▲’17 15% 13% 7%▼’17 2%
1–20 9% 5% 9%▲’17 10% 8%
0 hours 7% 12%▲’17’16 29%▲’16 69%▲’17’16 87%
Business Ownership and Homemaker Status
Business owner 30%▲’17 16% 11% 8% 4%
Homemaker 3% 8%▲’17 6% 4% 4%’16
Retirement Status
Fully-retired 6% 2% 19%’16 63%▲’16 80%
Semi-retired 3% 3% 11% 12% 11%
Not retired 91%q’17 95% 69%’16 25% 9%
40%
13%
8%
39%
13%
5%
32%
8%
60%
Low High
Key ≤ 20% 21% to 39% 40% to 57% 58% to 76% ≥77%
▲’17’16
q’17’16
▲’17
q’17’16
▲’17
▲’17’16

7© 2018 |
PRODUCT OWNERSHIP
BY GENERATION
ETF ownership is up significantly from prior years at the
expense of mutual funds
• Millennials are fueling increases in ownership of ETFs, SMAs and hedge funds.
Q27. Across all of your accounts, what percent of your household’s total investable assets are invested in each of the following…?
2nd Wave
Boomer
1st Wave
Boomer
Silent
Generation
Cash 76%’16 67%▼’17’16 82% 84% 85% ’16
Mutual funds 64% 61%▼’17 64% 63% ▼’16 62%
Individual stocks 71% 60% 58% 58% 63%
Annuities 46% 25% 29% 39% 43% ▲’16
CDs 45% 28% 29% 34% 34%
Individual bonds 52% 27% 26% 27% 29%
ETFs 43%▲’17 22% 17% 16% ▲’16 16%
SMAs 35%▲’17 13% 8% 8% 4%
Hedge funds 37%▲’17 13% 6% 6% 3%
Other 4% 5% 9% 7% 7%
78%
63%
61%
35%
33%
31%
21%
13%
12%
7%
Low High
Key ≤19% 20% to 35% 36% to 51% 52% to 68% ≥69%
▼’17
▲’16
▲’17

8© 2018 |
Affluent Millennials are taking on more investment risk
• The youngest generation of affluent investors reports holding 29% investment dollars in a
high-risk instrument, up from 24% last year and substantially higher compared with 18%
among the investor population overall.
Q26. What percent of your total investable assets fall into each of these Investment Risk Tolerance levels?
All Affluent Investors
Total
Generation
Millennial
Gen X
2nd Wave Boomer
1st Wave Boomer
Silent Generation
Wealth Segment
$100K–<$500K
$500K–<$2M
$2M+
39%
34%
33%
35%
46%
46%
42%
35%
33%
44%
37%
44%
47%
44%
44%
42%
46%
46%
18%
29%
23%
18%
10%
10%
17%
19%
21%
Low risk Moderate risk High risk
▼’17’16 ▲’17
INVESTOR RISK TOLERANCE
BY GENERATION AND WEALTH SEGMENTS

9© 2018 |
Robo-advice use is on the rise
• Millennials lead the charge in increasing robo-advisor investing. Meanwhile, financial advisors
continue to play a critical role influencing investment decisions.
Q29. What percent of your total investable assets are managed…?
ADVISED INVESTOR PROFILE: TRADITIONALLY ADVISED, “ADVICED” AND
SELF-DIRECTED SEGMENTS
Generation
2nd Wave
Baby
Boomer
1st Wave
Baby
Boomer
Silent
Gener-
ation
% Advised
(by financial advisor)
38%’16 38% 34% 36% 43%’16 36%’16
% “Adviced”
(by online provider, firm
investment
representative)
28%’16 34% 27% 28% 27%’16 30%
% Self-directed 34% 28% 39% 36% 31% 34%
% Robo-advised 32%▲’17 70%▲’17 38%’16 23% 20%▲’17 14%

10© 2018 |
Financial advisors serve a more-affluent investor population
• Meanwhile, younger investors are turning to other advice sources.
Q29. What percent of your total investable assets are managed…?
Generation
Millennials
Gen X
2nd Wave Baby Boomers
1st Wave Baby Boomers
Silent Generation
15%
24%
19%
32%
10%
Traditionally Advised
(by financial advisor)
38% of affluent investors
(A)
“Adviced”
(by online provider, firm investment
representative)
29% of affluent investors
(B)
17%
25%
20%
27%
11%
’16 B
’16
▼’17
▲’16
ADVISED INVESTOR PROFILE: TRADITIONALLY ADVISED AND
“ADVICED” SEGMENTS

11© 2018 |
Generation
Millennials Gen X 2nd
Wave
Baby
Boomers
1st
Wave
Baby
Boomers
Silent
Generation
Investors are re-engaging with robo-advisors
• The uptick in engagement with robo-advisors is driven by Millennials (70%) and 1st Wave
Baby Boomers (20%).
Q29a. What percent of your total investable assets are managed using this type of service? (responses of 1% or more are considered users)
PERCENTAGE OF INVESTORS USING ROBO-ADVISORS
70%
38%
23% 20%
14%
Percentage using one robo-advisor provider: 70%
Average number of robo-advisor relationships: 1.31
▲’17
’16
▲’17
▲’17 ▲’17’16
q’17’16

12© 2018 |
Affluent investors are in control of their current finances
• That said, Millennials are more moderate in their comfort level with their house hold finances
than investors in older generations.
Q600. How much do you agree or disagree with the following statements? (1–5 scale where 1 is strongly disagree and 5 is strongly agree)
* New in 2018
HOUSEHOLD FINANCES*
TOP TWO-BOX AGREE
Generation
Millennial Gen X
2nd Wave
Boomer
1st Wave
Boomer
Silent
Generation
I have control over my day-to-day finances (food, gas, transportation,
etc.) and month-to-month (rent/mortgage payment, utilities, cell
phone, etc.)
69% 76% 87% 92% 94%
I have enough money to pay for an annual vacation 64% 72% 82% 89% 91%
I am able to live within my means, keep current with my credit card
payments and other debts while also saving for retirement,
emergencies and other shorter-tem goals
66% 73% 81% 87% 91%
So far I have been able to stay on track saving for retirement 60% 64% 76% 85% 87%
I often feel anxious or stressed about my current financial security 39% 26% 16% 9% 7%
I would not be able to pay for an unexpected expense (such as an
emergency illness or car repair) that was more than my monthly
earnings
37% 24% 12% 10% 6%
I struggle with paying down debt from credit cards, student loans
and/or other loans
32% 18% 9% 4% 3%
Low High
Key ≤ 21% 22% to 39% 40% to 57% 58% to 75% ≥76%

13© 2018 |
Digital resources are drawing users from multiple generations
• Regardless of the planning phase, affluent Millennials are turning to financial planning websites
and are more likely than any other generation to use financial media sites and social media.
Q601. Based on the definition above, have you done any aspect of financial planning for yourself or your family?
Q602. Which of the following financial planning resources did you use?
Base: Affluent investors who have or are working on a financial plan
A/B, C/D, E/F, G/H, I/J = Significant difference between those have a financial plan and those working on one
* New question in 2018
FINANCIAL PLANNING RESOURCES USED*
Among those who have/are working on a
financial plan
Millennial Gen X 2nd Wave
Boomer
1st Wave
Boomer
Silent
Generation
Have Working Have Working Have Working Have Working Have Working
(A) (B) (C) (D) (E) (F) (G) (H) (I) (J)
Financial advisor 29% 27% 35% D 22% 37% F 23% 38% H 24% 28% 14%
Certified financial planner 26% 20% 18% D 11% 27% F 13% 27% 28% 25% 11%
Financial planning website 36% 32% 22% 26% 16% 24% E 8% 14% G 4% 4%
My primary bank/a professional from my bank 20% B 11% 13% 10% 9% 13% 12% 13% 9% 19%
A financial professional through my employer 21% 22% 12% 14% 12% 12% 7% 8% 2% 2%
Investment account distributor firm 17% 12% 8% 12% 7% 5% 6% 8% 8% 6%
Financial media sites 11% 18% A 10% 13% 5% 12% E 4% 9% G 2% 4%
Financial planning site on social media 12% 17% 3% 5% 1% 1% 1% 1% <1% —
None of the above 13% 14% 23% 26% 23% 25% 23% 28% 35% 53% I
Low High
Key ≤ 10% 11% to 21% 22% to 32% 33% to 42% ≥43%

14© 2018 |
Millennial and ready-to-act affluent investors report the most outreach from financial
services providers
• Millennials report more than three times the typical volume, followed by ready-to-act
investors, who field one and a half times the overall average number of monthly touchpoints.
Q304. In a typical month, how many of the following communications do you receive from all financial services companies?
Base: All affluent investors
2nd Wave
Boomer
1st Wave
Boomer
Silent
Gen
Ready-
to-act
Emails 3.6 7.2 3.6 3.6 2.6 2.4 4.6
Print mailings 2.3 4.7 2.1 2.0 1.9 1.9 2.9
Phone calls/emails/texts with my financial
advisors
1.6 5.7 1.6 0.8 0.8 0.7 2.7
Phone calls/emails with a company
representative
1.2 4.8 1.2 0.6 0.4 0.5 2.1
Mobile app notifications 1.2 4.7 1.6 0.7 0.2 0.1 2.2
Invitations to webinars/podcasts 1.1 4.2 0.9 0.8 0.6 0.6 2.1
Social media outreach/invitations
(Facebook, LinkedIn, Twitter, blogs, etc.)
1.1 5.5 1.2 0.4 0.2 0.2 2.3
Invitations to events sponsored by
company
1.1 4.8 0.9 0.6 0.5 0.4 2.1
Total (monthly) 13.2 41.6 13.1 9.5 7.2 6.8 21.0
Low High
Key ≤ 1.52 1.53 to 2.94 2.95 to 4.36 4.37 to 5.78 ≥5.79
AVERAGE NUMBER OF TOUCHES ACROSS ALL FINANCIAL SERVICES PROVIDERS*
PER MONTH

15© 2018 |
Affluent investors cite email as the most effective way for financial services providers
to communicate
• In addition to email, Millennials report the strongest preference for websites and mobile apps.
Q304. In a typical month, how many of the following communications do you receive from all financial services companies?
Base: All affluent investors
MOST EFFECTIVE COMMUNICATION METHOD: STATED*
2nd Wave
Boomer
1st Wave
Boomer
Silent
Gen
Ready-
to-act
(A) (B) (C) (D) (E) (F) (G)
Emails 42% 33% 49% 45% 38% 41% 38%
Print mailings 15% 5% 10% 17% 19% 23% 10%
Phone call with my financial advisor 14% 7% 9% 14% 20% 17% 11%
Websites 12% 15% 14% 12% 9% 8% 16%
Phone call with a company
representative
8% 10% 5% 8% 9% 10% 9%
Mobile apps 4% 13% 6% 2% 1% <1% 8%
Social media (Facebook, LinkedIn,
Twitter, blogs, etc.)
2% 9% 3% 1% 1% <1% 4%
Conference or event
sponsored by company
2% 5% 1% 1% 2% 1% 3%
Webinar/podcasts 1% 2% 2% 1% 1% <1% 2%
Low High
Key ≤9% 10% to 19% 20% to 29% 30% to 39% ≥40%

16© 2018 |
Key Takeaways
• Affluent Millennials are searching for new
ways to invest their money. Increases in ETF
and separately managed accounts (SMAs)
ownership as well as robo-advisor usage are
being fueled by the youngest generation of
investors.
• Millennial affluent investors report more than
three times the typical volume of touches
received on a monthly basis, and report the
strongest preference for contact via digital
channels.
• For nearly two decades, the world’s top firms
have turned to Cogent Reports for industry-
leading data and research, using the rich
insights to elevate their brand, increase
market share and benchmark their
performance against competitors.
Contact us today to put our research to
work for you.

Understanding
Next Gen Investors
Highlighted national research study findings
February 6, 2019

18© 2018 |
Methodology
• Custom 25-question survey designed collaboratively by Broadridge Financial Solutions, Inc., and The Center for Generational
Kinetics.
• Study was administered to 1,003 U.S. respondents ages 22-59. The sample was weighted to current U.S. Census data for age,
region, and gender.
• Survey was conducted online from July 10, 2018 to July 16, 2018.
• Figures are statistically significant at the 95% confidence level. Margin of error is +/-3.1 percentage points.
• Please note that “By Total” in any graph represents the sample as a whole. In an instance that a chart total for a single select
questions does not add to 100%, please note that this is due to the minimal effect of rounding.
18

19© 2018 |
Sample Overview
Male
1,003
participants
47% 53%
27%
URBAN
34% 49%
SUBURBAN RURAL
18%
Gen X
(42-53)
58%
27%
Millennials
(22-41)
16%
Boomers
(54-59)
16%
58%
Female

20© 2018 |
The majority of people do not
currently have or use a financial advisor
• 69% of Millennials currently do not have or use a financial advisor. Across the U.S.,
men are more likely to have a financial advisor than women.
S4. Do you currently have or use a financial advisor?
31% 31% 28%
35%
69% 69% 72%
65%
Total Millennials Gen X Boomers
CURRENTLY HAVE OR USE A FINANCIAL ADVISOR
35%
27%
65%
73%
Men Women
No Yes

21© 2018 |
Despite most Americans not having a financial advisor,
most do say they are saving for retirement
However, nearly a third of young people currently have no Retirement savings plan.
S5. Do you currently participate in a retirement savings plan? Please select one.
49%
8%
9%
33%
44%
8%
17%
32%
39%
15%
18%
27%
CURRENTLY HAVE A RETIREMENT SAVINGS PLAN
Millennials Gen X Boomers
68%
32%
Yes No
CURRENTLY HAVE A RETIREMENT
SAVINGS PLAN (BY TOTAL)
Yes, at my workplace (401k,
403b, pension, HSA, etc.)
Yes, through a non-workplace
tax advantage savings account
(IRA, Roth IRA, Annuity, etc.)
Yes, through both a workplace
and non-workplace retirement
plan/account
No

22© 2018 |
Millennials are the only generation that
trusts friends and family more than financial advisors
Q8. Where do you look for advice for saving for retirement? Please select your top three.
29%
22%
16%
18%
14%
23%
23%
18%
15%
12%
24%
32%
18%
13%
11%
SAVING FOR RETIREMENT ADVICE (TOP 5 OF 16)
Millennials
Gen X
Boomers
Trusted friend or
family member
A financial professional
or advisor
Workplace plan
information
Bank, investment, or
other financial website
Online search, forum,
blog, or message board

23© 2018 |
Most Millennials see the stock market as having favoritism but
believe it still offers promising options for their investment future
Q1. Which of these statements best reflects your view about the stock market? Please select one.
43%
24%
21%
12%
36%
30%
21%
13%
36%
28%
19%
17%
VIEW OF THE STOCK MARKET
Millennials
Gen X
Boomers
There is favoritism,
but it still offers
opportunities for
growth for me
There are always
winners and
losers…I will be a
winner
I love the
system as it is
It is a rigged game
in which I cannot
win

24© 2018 |
Millennials are more confident about investing
in a savings account than other investment options
Q4. How confident are you in each of the following ways of investing your money?
1 = Not at all confident; 5 = Very confident
66%
58%
51% 50%
42%
60% 62%
57%
43% 45%
57%
72%
67%
43%
48%
CONFIDENCE IN EACH METHOD OF INVESTING
(TOP TWO BOX: VERY CONFIDENT & CONFIDENT; TOP 5 OF 9)
Millennials Gen X Boomers
Savings account Workplace retirement
plan (401k, etc.)
Tax advantage plan
(Roth IRA, annuity, etc.)
Investing in myself
(education, starting a
business, etc.)
Real Estate

25© 2018 |
Across generations, consumers have varying
to low confidence about robo-advisor investing
There is even less confidence about investing through private business shares
and the global market, especially with Boomers.
Q4. How confident are you in each of the following ways of investing your money? 1 = Not at all confident; 5 = Very confident
38%
30%
30%
23%
44%
21%
24%
12%
47%
16%
21%
11%
CONFIDENCE IN EACH METHOD OF INVESTING
(TOP TWO BOX: VERY CONFIDENT & CONFIDENT; LOWEST 4 OF 9)
Millennials
Gen X
Boomers
Definition: Robo-advisor is
an online-only technology
tool that provides financial
advice or investment
management with moderate
to little human intervention.
US Stock Market
Purchasing shares
in a private
business
Global market
Robo advisor

26© 2018 |
More Millennials expect to receive an inheritance
than any other generation
Across generations, more men than women expect to receive an inheritance.
Q11. Do you think you will receive an inheritance from you parents or another family member? Please select one.
37% 40%
30%
36%
41% 38%
46%
45%
22% 22% 24%
19%
Total Millennials Gen X Boomers
WILL YOU RECEIVE AN INHERITANCE?
38% 35%
41%
42%
20% 23%
Men Women
Not sure
No
Yes

27© 2018 |
A robo-advisor is the least likely method to
manage a potential inheritance across generations
A current financial advisor, a new advisor, or a CPA are also unlikely methods for Millennials to
choose for managing a potential inheritance.
Q12. If you did receive an inheritance from your parents or another family member, how likely would you be to use each of these methods to
manage this transfer of wealth? 1=Not at all likely; 5=Very likely. *N=587 - Answered Yes or Not sure on Q11
38%
37%
35%
23%
27%
36%
29%
7%
33%
39%
21%
7%
METHODS OF MANAGING POTENTIAL INHERITANCE
(TOP TWO BOX: VERY LIKELY & LIKELY; BOTTOM 4 OF 9)
Millennials
Gen X
Boomers
Tax preparer,
CPA/financial accountant
Use the financial advisor
I currently have
Find a new
financial advisor
Use a robo-advisor

28© 2018 |
Millennials trust family and friends just as much
as a professional advisor for financial help or advice
Gen X and Boomers trust a financial professional more than family or friends for advice.
Q15. How much do you trust each of the following sources of financial help or advice? 1=Don’t trust at all; 5=Highly trust
52%
52%
38%
37%
36%
35%
42%
48%
28%
29%
28%
25%
39%
49%
20%
25%
24%
26%
TRUST IN EACH SOURCE OF FINANCIAL HELP OR ADVICE
(TOP TWO BOX: HIGHLY TRUST & TRUST; TOP 6 OF 12)
Millennials
Gen X
Boomers
Trusted friend
or family member
A financial professional
or advisor
Financial course,
program or plan
Bank, investment, or
other financial website
Bank or credit
union associate
Attorney

29© 2018 |
Financial Advisor of Millennials’ Parents
1/3 of Millennials’
parents currently use a
financial advisor
But, over halfof
Millennials would or might
consider using their parents’
financial advisor
55%
…only 20% of
Millennials have ever
met their parents’
financial advisor
Q17. Please answer Yes or No for each of the following questions.

30© 2018 |
Conclusion
• When compared to other generations,
Millennials show fascinating differences, and
interesting trends, in their views and attitudes
toward investing and financial advice.
• Recognizing and acting on these emerging
Millennial trends will position financial
advisors and the industry to attract and keep
this huge generation of clients at a critical
time in their wealth creation and loyalty-
building stage.
• For more information, download our white
paper Decoding the Millennial Mindset.
• To discover more about Broadridge
capabilities visit us at online or call (855) 252-
3822.

Preparing for the Next-Gen Client Base

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