For UK financial advisers only, not approved for use by retail customers. Click here for the customer website.

Financial Advice Opportunities

Insight from our experts on specific generational needs, as well as the principal life events that drive intergenerational needs, helping you open up new conversations.

Life events

While financial advice gives clients value all year round, there are specific events in life that bring intergenerational needs more specifically into focus, often taking your client's existing plan in new directions. Below you’ll find some of the most topical. 

Birth of a new child or grandchild

This life-changing event is often the catalyst for new intergenerational conversations, ranging from trusts and gifting, to ISAs, to planning for private school and university fees.

Inheritance and windfalls

Windfalls are rarely expected - or planned for - but have the potential to open new doors for current and future generations. New needs that follow typically include lump sum investing, gifting and estate planning, to reduce potential IHT liabilities.

Divorce

The separation of families – and finances - is increasingly common, bringing with it new financial needs, including: pension sharing (and potentially ‘rebuilding’), wills and CGT and IHT replanning.

The planning needs of different generations 

Key to adviser understanding of cross-generational needs is the May 2019 FCA paper ‘Intergenerational Needs’, which analyses the needs of three distinct generations: Baby Boomers, Generation X and Millennials. Below we’ve summarised each’s distinct characteristics and the resulting needs and financial advice opportunities. 

Baby Boomers (born 1946-1965)

Characteristics

Typically homeowners, benefiting from price growth over time. They have often accumulated pension wealth, either through a DB scheme or a variety of pension pots. Unlikely to have made provision for social care yet, their priority being to support younger generations. Traditionally have had little experience of professional financial or tax planning.

Typical financial and advice needs

  • How to employ accumulated wealth to maintain living standards in retirement

  • Potential need to access the equity in their homes

  • Solutions that balance day-to-day living and financial support for children and grandchildren with funding long-term care

  • Usage of allowances and tax planning to achieve their needs.

Generation X (born 1966-1980)

Characteristics

Typically property owners married with two children. Parents ageing. They have accumulated less wealth than their Baby Boomer parents had at the same age. May still have a mortgage to pay and other debts, so struggle to save into pensions or savings. They’re aware their pension pots will not be sufficient to retire comfortably. Finances are likely to be stretched today, but will often inherit from their parents in late 50s.

Typical financial and advice needs

  • Cashflow planning to identify gaps

  • Plan for pensions and longer term needs now before ‘catch-up’ is too late

  • Potential opportunities to use any savings and investments to pay down debts

  • Conversations about legacy and care planning for parents

Millennials (born 1981-2000)

Characteristics

More likely to be university educated than Baby Boomers, Millennials are often skilled, self-employed and likely to earn above average income. They are, however, burdened by high living costs and student debt. Ambitious and keen to get on the housing ladder, they are more motivated by short to medium-term needs over distant retirement. Likely to inherit property wealth.

Typical financial and advice needs

  • Budgeting tools, bill smoothing and income protection products to help with often unstable income

  • Strategies to help Millennials save for a deposit

  • Modelling to demonstrate the growth potential of early saving

Source. FCA paper: intergenerational differences: May 2019. Sections 8.20-8.22, 8.30-8.33 & 8.40-8.43 https://www.fca.org.uk/publication/discussion/dp19-02.pdf 

Tools and calculators

It’s essential that clients fully understand the impact increased wealth and potential IHT could have on their estate. We've a range of tools and calculators which are designed to help you demonstrate this clearly to your clients.

Retirement modeller

Explore planning scenarios across your client’s full retirement journey with Prudential’s Retirement Account.

Inheritance Tax Calculator

Calculate potential Inheritance Tax liabilities when establishing a discretionary Gift Trust, discretionary Discounted Gift Trust or discretionary Loan Trust.

School and University Fees Calculator

Discover the investment needed in an offshore bond to fund school or university fees and the tax payable on withdrawals.

Technical content and support 

We've a range of support on Intergenerational Planning, written by our technical experts, ensuring you stay up-to-date

 

It's good to talk...

For any help or support for your client’s needs, please don’t hesitate to contact one of our expert Account Managers.