Generation X is facing big problems. If your accountancy practice extends to consulting in the financial planning arena, there’s an opportunity for you to help solve their serious problems while offering advice on an hourly fee basis.
Who is Gen X?
Demographers and statisticians tend to group generations in 20 year segments. Seniors aged 70 to 90 are often called the Silent Generation, having been born between 1925 and 1945. Baby Boomers followed between 1945 and 1965. They are about 50 to 70 today. Gen X, born 1965 to 1985 is 30 to 50 years old today. Predictably they are followed by Gen Y, although the marketing folks invented Millennials, who overlap in the 18-35 year age bracket.
If Gen X is 30 to 50 years old, they likely have children. The average age of mothers and fathers is 30.2 and 33.1 respectively, so this means Gen X likely has young children at home.
Let’s look at problems
People all around the world share many of the same values. Parents want the best life possible for their children. Education is often considered the best route.
Paying for university education
This is one of the biggest concerns for Gen X parents. University educations are expensive, with tuition fees costing £9,250 per year from Autumn 2017. Then add on living expenses, estimated at £12,000 per year outside of London and £15,000 per year in the capital. The numbers sound daunting today and they are likely to rise. Helping clients plan for these expenses and helping keep them on track should reduce their anxiety level. Your advice has practical value.
Planning and meeting wedding expenses
This is another big issue. The average cost of a wedding is now more than £25,000 and 48% of couples still get help from their parents and in 6% of cases, the bride’s family pays the entire bill. Even the BBC series ‘Don’t Tell the Bride’ has the groom organising the wedding on a tight £12,000 budget.
The 45-year-old Gen X couple who had children at 25 likely has twentysomethings at home. Bear in mind that the average age to get married in the UK is about 30.
This is an expense that can be anticipated through financial planning. It can also be addressed through liquidity provided by home equity loans if events unfold at a faster pace.
Boomerang children returning home
This can be an unexpected issue. According to The Guardian, two million adult Britons have moved back home, a quarter of all 20 to 34-year-old working Britons. Often this is related to the difficulty young people encounter getting on the first rung of the property ladder. According to a Lloyds study, parents paid £4.1bn in rent payments in 2015 helping their children. Their children are looking for careers, not a low paying job that will barely pay rent.
The go-to person for advice
This is another elephant in the room issue where your client needs sound advice, but doesn’t know where to turn. This may be a situation where you are doing pro bono work, not expecting to be paid. They need advice on how to focus their children on getting their first real job or finding an affordable apartment. By being a receptive and patient listener, you position yourself as their go-to person for financial advice. Billable opportunities will come later.
Sometimes that first job in their chosen field requires more education. Funding advanced degrees is another looming expense. For example you may need a postgraduate certificate in education (PGCE) to become a teacher. Becoming a solicitor requires the Legal Practice Course (LPC). This involves another additional expense. Will it be borne by the parents? Will their child become a professional student? Will their child take out a student loan? Realistically speaking, will this additional degree give them a reasonable chance of getting the job they want? Will the school help them with job placement?
This is another financial planning issue and you are well positioned to help.
Gen X clients face serious problems that keep them awake at night. You are in a position to help, especially if you have expanded your practice into consulting within the financial planning area.
About Bryce Sanders
Bryce Sanders is president of Perceptive Business Solutions Inc. in New Hope, Pennsylvania.