Breaking down the trust deficit in financial services

by. Matt Neznanski

Since 2008, consumer confidence in financial institutions has declined 46 percent in the U.S. Millennials are four times more likely than their parents to seek input beyond that of a financial advisor. Even among those who have accounts at a traditional institution, nearly half of people in this age group use prepaid cards and payday loans.

It’s no wonder young people are leery of traditional institutions: economic recovery seems to be taking a long time to trickle down to them. Just six in ten 18 to 29-year-olds are working, and half of those are at part-time jobs. Meanwhile, 70% of college graduates in 2012 had student loan debt that averaged almost $30,000, which has led them to generally avoid consumer debt.

On the upside, those same young adults actively seek information about purchasing and investing, and, while they are certainly technology dependent, they crave good old personal support and advice from knowledgeable people.

In their book, “The Trusted Advisor,” David H. Maiser, Charles H. Green, and Robert M. Halford list five stages to building trust with clients. Here’s my take on how to apply them to the problem at hand.

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