Citizens Survey Finds Majority of Americans Ill-Prepared for Historic Multigenerational Wealth Transfer
15 5월 2024 - 10:00PM
Business Wire
Nearly three quarters of Americans (72%) lack the financial
confidence needed to manage a large influx of money on their own,
according to a new survey by Citizens. As Baby Boomers, the most
financially prosperous generation in history, are set to transfer
$84 trillion* in assets over the next few decades, subsequent
generations are bracing for what’s being deemed, ‘The Great Wealth
Transfer.’ The survey, released today, offers insights into
Americans' preparedness to handle significant inbound wealth,
underscoring the critical need for expert financial guidance.
"A staggering amount of personal wealth is projected to be
passed on to heirs in the coming years, making it the largest
transfer of assets in U.S. history,” said Brendan Coughlin, Vice
Chair and Head of Consumer Banking at Citizens. "Despite the fact
that the majority of Americans acknowledge the importance of having
an experienced financial advisor, our new survey shows that more
than 50% of Millennials and Gen Z adults have received poor advice
in the past. This sharply underscores an opportunity for seasoned
wealth managers to foster meaningful, trusted relationships with
customers and take market share from the large incumbent wealth
firms. At Citizens, we are committed to guiding our customers with
personalized advice throughout their financial journey.”
The Citizens survey of more than 1,500 Americans with an
oversample of 500 owners of small and mid-market businesses (SMBs),
reveals a significant gap in financial confidence and the urgent
need for education on the value of engaging a trusted financial
advisor. Additional key findings include:
The Great Wind-fail?
- As the ‘Great Wealth Transfer’ accelerates, nearly one-third
(31%) of Americans anticipate receiving an inheritance within five
years, with Millennials (55%) and Gen Z (41%) among those who feel
it’s most likely in their future.
- A majority of Americans (61%) would turn to a financial advisor
for guidance if they received a large influx of money, yet the
likelihood descends by generation – Gen X (67%), Millennials (61%)
and Gen Z (59%) would consult an advisor or banker
post-inheritance.
- Nearly one-third (29%) of Americans report they would need to
receive an inheritance of at least $1 million to seek professional
direction on how to manage it.
It’s a Matter of Trust
- In an era when financial advice is abundant, especially online,
just under a third of Americans (32%), particularly Millennials
(54%) and Gen Z (51%), say they have received poor advice after
coming into a large sum of money.
- Most Americans (51%) admit they have acted upon financial
guidance found on social media, with nearly one-quarter following
advice for saving strategies and investments (23% each).
Achieving Financial Goals
- A whopping 94% of Americans with financial goals recognize the
importance of an experienced financial advisor to help achieve
them. Eighty percent would consult an advisor, with investing more
(29%), saving for retirement (29%) and building up their savings
(28%) as their top objectives.
- Effective financial advisory relationships rely on mutual
understanding, with 65% of Americans emphasizing the importance of
communication with their advisors, in addition to a successful
track record (61%) and personalized insights (59%).
Putting Newfound Wealth to Use
- While many are unsure how they would manage a windfall, they do
have thoughts around how they would spend it – 34% of American say
they would start a new business and 33% would invest it in a family
member's education.
- More than a third of respondents are eyeing a new car (36%),
while more than a quarter of Americans (26%) dream of traveling the
globe, and one in five (20%) would buy a vacation home.
Businesses Brace for Change
- The majority of SMB owners (69%) are not completely confident
they could manage a financial windfall on their own.
- Sixty percent of SMB owners have experienced negative
consequences due to bad financial advice, including lost revenue
(35%), increased debt (25%) and had to increase costs (22%).
- When it comes to how business owners would spend a windfall,
38% would start a new business, 37% would travel the world and 32%
would buy a vacation retreat.
"Even seasoned business owners can face challenges in managing
sudden financial windfalls,” said Don McCree, Vice Chair and Head
of Commercial Banking at Citizens. “High quality financial advice
is critical to long-term success, especially for small and
mid-market businesses who may have less margin for error within
their balance sheets.”
To see more results from Citizens’ survey on inheritance and
consumer financial confidence, please click here.
*According to financial research firm Cerulli Associates
Methodology
This Citizens survey was conducted by Wakefield Research
(www.wakefieldresearch.com) among 1,500 nationally representative
US adults ages 18+, including an oversample of 500 business owners
of small and mid-market businesses, between February 16th and March
1st 2024 using an email invitation and an online survey. Small
businesses are defined as those with annual revenue of up to $25M
and mid-market businesses are defined as those with annual revenue
of $25M to $500M. Data has been weighted.
About Citizens Financial Group,
Inc.
Citizens Financial Group, Inc. is one of the nation’s oldest and
largest financial institutions, with $220.4 billion in assets as of
March 31, 2024. Headquartered in Providence, Rhode Island, Citizens
offers a broad range of retail and commercial banking products and
services to individuals, small businesses, middle-market companies,
large corporations and institutions. Citizens helps its customers
reach their potential by listening to them and by understanding
their needs in order to offer tailored advice, ideas and solutions.
In Consumer Banking, Citizens provides an integrated experience
that includes mobile and online banking, a full-service customer
contact center and the convenience of approximately 3,300 ATMs and
approximately 1,000 branches in 14 states and the District of
Columbia. Consumer Banking products and services include a full
range of banking, lending, savings, wealth management and small
business offerings. In Commercial Banking, Citizens offers a broad
complement of financial products and solutions, including lending
and leasing, deposit and treasury management services, foreign
exchange, interest rate and commodity risk management solutions, as
well as loan syndication, corporate finance, merger and
acquisition, and debt and equity capital markets capabilities. More
information is available at www.citizensbank.com or visit us on
Twitter, LinkedIn or Facebook.
Citizens Wealth Management (in certain instances DBA Citizens
Private Wealth) is a division of Citizens Bank, N.A. (“Citizens”).
Securities, insurance, brokerage services, and investment advisory
services offered by Citizens Securities, Inc. (“CSI”), a registered
broker-dealer and SEC registered investment adviser - Member
FINRA/SIPC. Investment advisory services may also be offered by
Clarfeld Financial Advisors, LLC (“CFA”), an SEC registered
investment adviser, or by unaffiliated members of FINRA and SIPC
providing brokerage and custody services to CFA clients (see Form
ADV for details). Insurance products may also be offered by Estate
Preservation Services, LLC (“EPS”) or an unaffiliated party. CSI,
CFA and EPS are affiliates of Citizens. Banking products and
trust services offered by Citizens.
Securities, Investments and Insurance Products are subject to
risk, including principal amount invested, and are:
NOT FDIC INSURED
NOT BANK GUARANTEED
NOT A DEPOSIT
NOT INSURED BY ANY FEDERAL GOVERNMENT
AGENCY
MAY LOSE VALUE
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version on businesswire.com: https://www.businesswire.com/news/home/20240515071374/en/
Media Contact: Michelle King Savio
michelle.kingsavio@citizensbank.com 781-375-0035
Citizens Financial (NYSE:CFG)
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