Rich Uncle Ralph: Here to Teach Us (and Your Clients’ Kids) a Thing or Two About Financial Planning

Ralph DoggettMulti-generational planning – that is, financial planning with multiple generations within the same family – shouldn’t be a concept that’s new to anyone who reads this blog. We’ve covered it before in our interview with Ciccarelli Advisory Services, Inc., as well as during our joint blog with Everplans. One thing that is a relatively new concept though is Ralph Doggett’s nontraditional approach to multi-generational planning. His Washington-based firm first tried the traditional approach of trying to engage older millennials due to inherit their parents’ wealth. However, he had more success helping younger millennials and members of Gen Z, usually ranging from age 13-to 21-years-old. In this approach, his focus isn’t just on the family’s wealth. Rather, it’s focused on acting as a financial life coach for the child, through a series of meetings that he calls “My Rich Uncle Ralph Meetings.” This new offering truly is a value-add service for both his clients and their children.

Why meet with your rich uncle?

The premise of these meetings is simple: If you had a rich uncle, what would you ask him? The primary goal is to provide the younger generation with life advice and guidance that they’re typically not getting at school. And though often the parents are offering this type of advice, the children are not necessarily receptive of it, due to the source. Ralph and is his team are able to act as a neutral third-party source on everything from career to personal finances.

This approach helps circumvent a common issue that often comes up when advisors do multi-generational planning with older millennials, where firms feel the need to bring a younger advisor on board who can more easily relate to and better serve this younger clientele over the long-term. However, Ralph’s approach is focused on younger millennials and Gen Z and has him taking on the role of “uncle.” Therefore, the clients’ kids are expecting a more experienced advisor with worthwhile bits of life advice.

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Some recurring themes

So far, Ralph and his team have conducted about 30 of these meetings. Though each is relatively free-form, they have identified a few recurring issues that they continue to help their clients’ children with:

  • How to manage personal finances (namely debt) – This covers everything from budgeting to managing student loans. Much of it has to do with making the child financially aware of their decisions. Ralph sees the group of 13- to 21-year-olds as already very aware of the early-in-life financial mistakes that their older siblings, or even their parents made, and they don’t want to repeat them. He often cites when working with them, explaining that if they approach debt the right way, they can manage it and succeed.
  • How to find a job or navigate a career track – Ralph uses his personal network to put the kids in touch with professionals who do what the kids are interested in. Once connected, they can shadow or intern to help confirm that it is the career track that they want to pursue. It puts the child in a major advantage to be able to work toward the profession that he or she wants. Not only that, but Ralph intends on helping some of these children navigate how to prepare and handle the job interview process.
  • How to decide on schools and payment plans – This is as much about educating the children on their options as it is about educating the parents. Picking schools and navigating student loans is a cumbersome and confusing process. Ralph recalls a meeting with a widow and her child, who is very interested in becoming a doctor. The mother thought it wasn’t possible, but after a few meetings with Ralph, the family’s perspective changed. Ralph was able to connect the child with a few doctors to reconfirm she was prepared and truly interested in this line of work. He was also able to demonstrate how the family could afford the education required for this profession.
  • How to figure out what you’re passionate about – Ralph cites a few examples of meetings where he asked a series of questions, such as: What do you want to do? What school do you want to go to? What do you want to study? The answer is often a resounding “I don’t know.” Ralph cites too many options as being the primary issue amongst this younger generation. They have so many choices in front of them that sometimes they need guidance from someone like their “Rich Uncle Ralph” to help them realize what they’re truly interested in or passionate about. This helps drive many other life and financial decisions in their lives. It also helps enhance the parent-child relationship in going through this experience together.

Why this approach works

Let’s be honest, while this does sound like a super valuable service to provide to your clients’ kids, it also sounds like a lot of work, right? That’s why it’s important to think big picture about what this type of offering can do for you, your clients, and your overall business. Over the short-term, offering this type of service provides a few major benefits. For one, you’ll develop stickier clients. It’s an opportunity to develop an even deeper relationship with your existing clients, and to extend out your offering beyond just your typical investment or financial advice. This also enables you to establish a truly differentiated value proposition in marketing to your prospects and clients. This would help set you apart from not just other financial advisors, but also the virtual and robo-advisors who can’t provide this personalized level of service.

The long-term view of how this ultimately helps your business is that it provides you with an opportunity to be introduced to your clients’ kids in a very natural and genuine way. So when they get older and wealthier (or even retain the wealth of their parents), you’re most likely the source they’ll reach out to for financial and investment advice. Not only does this help you get ahead of the eventual wealth transfer that’ll happen within the families you serve, but it’ll also help you diversify your book of clients so there’s a mix of older and younger investors. If your business plans to be around over the long-term, it needs those younger clients with growing assets to complement your other older clients with decumulating assets.

What’s next for our rich Uncle Ralph?

For now these “My Rich Uncle Ralph Meetings” remain just a value-add service that Ralph is able to provide to his clients and families. But you can clearly see how you could charge parents for this type of service as a financial advisor and truly develop an additional line of revenue. Ralph already has a few ideas up his sleeve, such as developing a 10-week-program with groups of his clients’ kids, that includes a full curriculum of content to walk them through these key life issues. In the meantime, Ralph will continue to ride the success of this new offering and learn from each meeting in order to better develop a program specifically geared for his clients’ children.

The opinions and views expressed herein are those of Ralph Doggett. SEI bears no responsibility for their accuracy. Ralph Doggett is not affiliated with SEI or its subsidiaries.

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Missy Pohlig

Missy Pohlig

Missy Pohlig is the millennial contributor for Practically Speaking and also serves as Program Manager for the Solutions Team in the SEI Advisor Network.

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