‘Convenience and flexibility’: Digital delivery in high demand

As to be expected, modern technology has changed the way Australians approach investing, according to Fidelity International’s Next Generation report, with two in five Australian investors using mobile trading apps, one in four utilising online brokerage accounts, and three in five using apps or websites to help manage their finances.

Gen Z and Y, or “next-gen” investors as referred to by the report, have taken to this trend rather readily as 50 per cent of Gen Z and Y investors report using a mobile trading app. In contrast, half as many Gen X respondents said the same, as this cohort more heavily favoured investing through a stockbroker instead.

To this point, the availability of advisers to offer interactive planning tools, education and resources, digital engagement platforms, and tech integration, made up half of next-gen investors’ top eight preferences in terms of their advice experience.

Looking specifically at their priorities in terms of digital capabilities, 45 per cent of next-gens indicated that early investment monitoring was a key expectation from their financial adviser.

Meanwhile, 39 per cent of these investors indicated that secure digital document access, online financial tools and resources, mobile app usability, and highly user-friendly design were all crucial aspects of the advice experience.

Despite digital capabilities being of clear value to young investors, in-person meetings remain the preferred form of communication for both Gen X (59 per cent) and Z (55 per cent), though Gen Y was considerably more in favour of email communication (64 per cent) over in-person meetings (53 per cent).

As such, the report suggested that “while digital communication is critical, the personal touch that comes with face-to-face interactions remains valued by all generations”.

Meanwhile, “finfluencers” have risen in popularity over recent years, particularly among younger generations, with one in five Gen Zs turning to social media when making investment decisions, compared with one in 10 Gen Ys and just 3 per cent of Gen X.

Though, even more are still consuming “finfluencer” content, if not actively turning to it, as reported by one in two Gen Z, two in five Gen Y, and one in five Gen X, with YouTube, Instagram and TikTok the most common platforms for accessing such content.

While this suggests a clear yearning for financial literacy education on the part of young people, it also puts them at high risk of taking unfettered advice from unqualified personnel.

With consideration to the younger generation’s clear interest in digital accessibility, combined with their increased desire for self-improvement and financial education, the report suggested that these investors are “increasingly likely to take a more hands-on approach” when it comes to managing their finances.

As such, advisers may need to adjust their service offerings to appeal to the next wave of potential clients, with the report noting the need to balance their digital expectations with the desire for personalised, high-quality financial advice.

“The younger generation’s desire for convenience and flexibility offers an avenue for advisers to offer more personalised and adaptive services, ensuring they can meet clients where they are, whether digitally or in person,” the report said.