Three significant trends confirm the importance of Millennials or Gen Y to the future of your practice. The sheer size of the generation, their transition to greater financial responsibility, and their surprising financial attitudes make this generation even more impactful than Baby Boomers and Gen Xers.
Too big to ignore
In 2016, Millennials became the largest generation in history, overtaking a position long held by Baby Boomers. Boomers peaked at 76 million; Millennials are expected to top out at 81.4 million by 2036. They comprise more than 30 percent of the workforce and expected to enter their highest earning years in 2020. By 2025, 48 percent of U.S. income will belong to Millennials. That income will need disability income protection.
Increasing financial responsibilities
Millennials are forecasted to represent at least one-third of the 2017 housing market, as first time home buyers. Homeownership often leads to insurance purchases, from personal lines products to life insurance. As financial responsibilities grow consumers become more interested in protecting assets, including their largest asset, the ability to earn an income.
Although Millennials are waiting longer to start a family, 82 percent of today’s births are by women in this age group. More than 16 million Millennial women are mothers. Marriage and children have a significant impact on how employee benefits are viewed. 73 percent of older millennials (25-34) make their benefit decisions based on these and other life events that heighten the need for financial stability. Employee benefit packages influence the decision to change jobs. Unlike previous generations’ workers, a benefit package that offers financial security is proven to increase employee loyalty among this group. Look to the multi-life market for opportunities to promote disability insurance benefits, especially voluntary disability insurance. Voluntary products offer the highly valued option to customize benefits.
Surprising views on financial security
You may be surprised to learn that Millennials are not the irresponsible group often portrayed in the media. As a group, they recognize the value of disability insurance as an employee benefit and see it as contributing to reduced financial stress. They tend to be much more financially conservative and risk averse than Baby Boomers and Gen Xers, in part due to witnessing first-hand the financial distress experienced by their parents during the Great Recession. A study by LifeCourse Associates, Why Generations Matter, reveals Millennials to be very interested in financial planning, financial education, and other support services. Good news for our industry; they tend to be more trusting of financial advisors and institutions than their predecessors. Overall, more participate in 401(k)s and contribute more than the minimum. Advisors can capitalize on the desire for financial education and security by introducing disability insurance to Millennial clients.
DIS will quote several disability insurance options for your Millennial clients to find the right combination of coverage and affordability. A future purchase option rider offers a foundation of coverage that can be built upon as income levels grow. Call us today for a quote or for ideas on how to best reach the Millennial market. Also, download our infographic “The New Face of Disability.”