Advisors hoping to connect with millennial clients should be ready to face criticism of the financial industry alongside the standard saving and investing hurdles, according to a report from Montreal-based think tank The Decision Lab.

The report, which was funded by the FP Canada Research Foundation, analyzed data previously published from 2015-2020 to understand the attitudes and values of those born between 1981 and 1995.

For many millennials, getting a solid education and seeking a good job hasn’t led to the same kind of financial success as their parents may have experienced. Instead, higher education meant “higher levels of debt than previous generations,” and millennials graduated into “one of the hardest job markets in a century,” the report said.

From there, Canada has seen the rise of the gig economy, the normalization of holding debt due to low interest rates, and rising home prices.

Generally speaking, millennials have low risk appetites, the report said. “They are anxious about their money and feel that their finances control their lives, rather than the other way around. They feel alienated from the traditional arc of ‘the good life,'” it said.

Many also have doubts about traditional financial institutions and systems, due largely to the 2008 global financial crisis, the report added, plus the impact of the pandemic.

So how should advisors address these challenges and fears, especially when friends and family are seen as more trusted information sources?

The report first suggested that advisors work on boosting millennials’ financial confidence while getting to know the ins and outs of their lives — a process that likely will uncover the need for “custom solutions” not applicable to older and wealthier segments.

One reason for that might be that a millennial client has multiple jobs or income streams, some of which may have murkier regulations and tax considerations, the report said.

“Household indebtedness has become prevalent,” coupled with “precarious employment and more volatile earnings than previous generations,” it said.

While much research has suggested that many millennials have “very little money” for either buying a home or eventually retiring, the report said, advisors shouldn’t assume this.

The generation also seems to value experiences over material possessions. A different sense of value can affect goals and can also play a part in the impact and legacy investments of wealthy millennials, or in environmental, social and governance interest.

“Millennials don’t just see money as a store of economic value, they see it as an expression of their ideals — such as inclusion and diversity, social justice and climate change. And there’s a real opportunity for financial professionals to better position themselves and adapt their service offerings,” said Brooke Struck, research director at The Decision Lab and the report’s author, in a release.

Digital tools are also critical, the report noted, for both operational support and keeping millennials motivated and engaged.

Financial technology, “has profoundly changed not only the way that customers expect services to be delivered, but also how practising professionals deliver those services,” the report said, noting that advisors can offer hybrid models but there must be integration between digital and analog tools.

Other factors to consider include possible aversion to investment fees, plus the ongoing wealth transfer in Canada.

The vast majority (approximately 80%) of the research analyzed in the report was from the financial industry, with the rest a mix of data from academia, government and non-profits. Read the full study.