The Millennial vs. The Account Minimum

“I would work with you, but my finances are a mess and I don’t have enough money to plan with.”  I actually think people in this situation are exactly who need the services of a financial planner.  I believe that at its core, financial planning is about building a future, not just managing assets.  If you had everything together and assets, you would need a manager to look after your assets instead of having a planner help you build and forecast your future assets.  It sounds confusing, but all of these services are usually done by the same person.  So why is our society under the delusion that you have to be wealthy to use the financial services industry?

I think it’s because of account minimum requirements.  We see television commercials say to call a firm if we “have $500,000 to invest” or read the fine print saying “this special is only available for accounts of $100,000 or more.”  Yes, there are reasons why firms have minimum requirements, but they can be disheartening for the millennial family.  I can relate because I am an old millennial, a term I created because I am in the millennial generation, but I am the complete opposite from the millennials we always hear about (I recently bought a watch with hands on it of all things!).

Millennials are the largest generation since the Baby Boomers and will have a major impact on the overall future of the United States and the financial services industry.  However, if I waited for the millennial generation to have “enough money,” I would be out of business.  I really enjoy working with millennials because we can start from scratch and build a plan with the goal of growing their wealth; similar to an entrepreneur growing a new business with each client.  Yes, you are the CEO of your home and thinking of your financial situation as a business can help!

Larger firms are slower to work with millennials because of account minimums.  Most firms use an Assets Under Management (AUM) model where the firm’s fee is a percentage of the account’s assets, so the larger accounts provide higher fees. This is important because so many more people work with your advisor.  Firms know exactly what they need to “break-even” when managing an account, which leads to minimum requirements.  Some firms require higher minimums because they only want affluent clients.  My firm actually allows me to have no minimums by letting me offset the break-even costs.  Having a little less income now lets me help clients build a plan from scratch, potentially yielding more income for me as well in the future.  When a client invests with me, I am also investing in them, as financial planning is supposed to be a long-term relationship anyway.  By following a plan, we have the potential to bypass the break-even point in a few years and the client is able to prepare for their future.

If you feel lost with your financial situation, let’s talk!  I may be able to help!


Jonathan Greeson is located west of 117 and south of E. Main St.
Jonathan Greeson is located west of 117 and south of E. Main St.

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100 West Main St.
Pikeville, NC 27863