Financial Services Council (FSC) chief executive Sally Loane has warned the wealth management industry about the dangers of neglecting younger, digitally-savvy Australians.
Speaking at the FSC Leaders Summit yesterday, Ms Loane said the Millennial demographic is “perhaps the most powerful force driving the inevitable change to super” as “the generation entering the workforce now”.
She said Millennials would constitute two-thirds of the workforce in just eight years’ time and that this demographic carried different expectations about their super than the generation before.
“They are gobsmacked when they call HR and find that they can’t move to a fund they want – whether it’s a new digital disruptor; one that aligns with a personal philosophy, like Australian Ethical; or another mainstream retail or industry fund,” Ms Loane said.
Millennials’ apathy towards their superannuation has seen a number of successful fintechs and start-ups emerge onto the financial services scene, such as GROW Super, Spaceship, Zuper and others, she said.
If the financial services industry failed to “crack this nut of engagement”, this would put further pressure on the age pension, the tax payer and the young person themselves when they reached the end of their working life.
“So – how do we get the unengaged, engaged?” Ms Loane asked.
She cited results from Deloitte that said appealing to this demographic would involve making financial services more digital, fun, meaningful, simple and relatable.
This meant moving to digital platforms, utilising social media, demonstrating that the investments aligned with social and ethical values, and recreating familiar experiences such as “Uber or Deliveroo”.
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