Millennials In Charge

Millennials in Charge- 5 FinTech Trends

If you’re reading this, you might be a millennial – which means you aren’t the kid everyone talks about online anymore. The youngest millennial will be 25 this year, with the oldest turning 50 by 2030! In fact, at over 9.8 million strong, or almost 26% of Canada's population, you comprise the single largest demographic. As a group, you are approaching your peak earning years and are typically interested in taking your personal financial goals and planning to the next level, particularly as saving for priorities like a home or retirement comes into focus. Simply put, millennials will dominate Canada’s future, just as the baby boomers did over the last three decades.

Pie Chart: Millennials Make Up 9.8M(25.7%) Of Canadas Population

 

So, what do millennials and their needs mean for the future of Financial Services? What other trends are paving the way for the FinTech firms they will do business with in the future?  WealthyPlanet provides online consumer financial planning for millennials, so it is very important we understand you,  part of this important client demographic. Here’s a deep dive into what’s unique about millennials and some future trends we can expect to see.

Making Up for Lost Time

As you know, millennials as a group have been financially punished compared to past generations. According to research firm Prophet, between slow income growth, high levels of debt, multiple recessions, and, of course, a global pandemic during what should be your peak earning years, millennials have been hit hard. So it's understandable that research shows you’re a prudent bunch that’s likely to perform more due diligence on the companies or advisors that you work with.

Do you see yourself in these stats?

- Millennials are twice as likely as baby boomers to use a Robo-advisor for investments

- Millennials are more likely than other generations to be part of the new gig economy, which grew at five times the predicted pace during the pandemic

- Female millennials are more likely to be educated, single and career-driven than prior generations

Working for the Man No More

Millennials, because of their very resilient upbringing, are redesigning and reinventing work. They have reinvented the sharing economy, including an expanding appetite for gig work and side hustles, which grew at five times the pace that was previously predicted for the twelve months of the pandemic, estimated to reach $335 billion by 2025. A lack of company-provided pension plans by a single employer, previously common in the baby boom generation, means millennials need to be more self-reliant about their own financial planning. 

Millennial women represent an estimated $170 billion of the cohort’s $200 billion buying power today. Is it any wonder that WealthyPlanet is targeting women and moms, in particular, tailoring online financial planning to their needs?

The “Open Banking” Revolution

Do you dread opening an account with a new financial institution? If so, you likely cringe at the thought of endless questionnaires and forms to sign that accompany each new application. A new report from Infinity Research sees “open banking” as a key trend that will spur growth in Canada’s financial services sector and provide significantly more choices for millennial consumers.

Open banking is a European regulatory evolution from traditional closed banking models, where your personal data is known only to the institutions where you have an account. This gives them the benefit of having a monopoly on your financial services needs. These regulatory changes are being studied in Canada and most likely will be adopted here in the next couple of years.

With the open banking model, your data is more easily shared between financial services firms – under strict privacy controls, of course – making it faster and easier to open new accounts. It places the power back into the hands of consumers like you. More importantly, it allows FinTechs such as WealthyPlanet to give you a faster and smoother onboarding experience. Your personalized strategic financial plan can be developed with far fewer questions to answer and forms to sign resulting in more convenience and choice. And goodbye to big bank domination we are known for in Canada.

Pie Chart: 28 Million Canadians Were Affected By A Data Breach

Privacy, Please

The millennial customer of the future will be in control of what data is shared, with whom, and what they get in return. You rightly view data as a form of currency, especially when you consider the lengths many bad actors have gone to breach networks and access customer data. A 2020 CIRA (Canadian Internet Registry Authority), cybersecurity report showed that 28 million Canadians, as high as 58% of the population, were affected by a data breach and the most common cause was unauthorized access.

It is an ongoing high priority for FinTechs companies to ensure client’s information is safe, we follow the same stringent privacy and compliance rules as large financial services firms.

Personalization is a Must

Yesterday, personalization meant getting one’s name right, but the future client expects more in the way of individualized products and experiences. This should come as no shock, as millennials like you are digital natives. You grew up with services on demand and, quite reasonably, expect frictionless, instant-access experiences.

That’s why the race is on to incorporate AI and other data-driven innovations. Not only to deliver smarter services but to educate clients and help you make savvy financial decisions. Letting you know when an account balance is low, for example, or even prompting with helpful nudges when an action like a tax form to fill out is triggered. The goal is to provide many means of communication that suit the need of the moment, whether it’s text, email, or other communications mediums favoured by the consumer.

High Tech and High Touch Hybrid

As digital emotional intelligence becomes more advanced and accurate, companies will also be investing more heavily but very smartly in digital-to-human exchanges, including AI bots. We expect to see this deeply individualized, even humanized,  with every company in the future, but in a hybrid fashion. 

When it comes to your money and financial planning, consumers still want the high-touch of an expert or advisor when they need one. The future is not Robo-only as this has not worked so far. People-to-people advice will not die but will be part of a hybrid approach for many companies. This is the strategy WealthyPlanet is incorporating with our expert Money Coaches: in-person, virtual online, or by phone when you need them.

WealthyPlanet prides itself on building a company of the future with a high level of service to meet the evolving needs of you: the important millennial generation.  We want to help you achieve your future dreams with strategic financial planning that is optimized for your entire holistic financial life.

 

WealthyPlanet gives everyday Canadians confidence about their financial future through a powerful and free online financial planning platform, cost-effective products, and money coach advice. 

 

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