Managed funds and financial advisers must completely rethink their strategies in talking with Generation X and Y because these two age groups do not know about such funds and they do not see advisers.
SMSF Strategies principal Grant Abbott said "Gen X needs to be taught about managed funds again, but they need coaches. Gen X do not have advisers - they have coaches, personal trainers who collaborate with them".
Those considered Generation X are born 1964 to 1982, and Gen Y from 1983 to 2001.
There was a wider threat as well, Abbott told delegates at last week's 12th Annual Wraps, Platforms and Masterfunds conference.
"In 2013, due to our lax licencing laws, anyone can do an RG146 course and have 'relevant experience' to be a strategic adviser," Abbott said.
"They can talk ETFs [exchange traded funds], managed funds ... but not give specific advice."
And, due to the accountants' exemption, about 10,000 accountants will be pitching for the Generation X and Y markets and selling self-managed superannuation funds (SMSF) because they make commissions - which are called 'administration fees'.
"So, how can we start to work with accountants?" he said.
Advisers should realise that only baby boomers and the war generations went to see financial advisers, Abbott said.
Gen X and Gen Y "don't have time to see an adviser. And, forget Google. They (Gen X and Y) go straight to Youtube . which is now the second most-used search engine."
By 2028, Abbott said, Deloitte predicted that $2.6 trillion would be in SMSFs.
The baby boomer generation is measured as those born from 1946 to 1963, with the war generation being births before 1946.
