Bradley Roulston speaks regu-larly to graduating classes at post-secondary institutions. The advisor and founder of Roulston Financial Group, which has offices in Toronto and Vancouver, says most of his clients came to him as a result of these talks.

Heralded a decade ago as Canada’s youngest certified financial planner, Roulston, now 33, naturally gravitated toward working with younger clients when he started his practice in Toronto — even though young adults are not regarded as a lucrative market for financial advisors.

While marketers of laptops, fast food and clothing are aggressively wooing young adults, few advisors target this group, reports the Financial Planners Standards Council. And Roulston admits this group is not profitable by typical financial advisory standards.

Yet Roulston — typical of his generation — is not looking to boost his income at all costs. “Quality of life is more important than anything else,” he says.

Besides, advisors who do target the under-35s find that they can be excellent clients. They want to buy homes, they need insurance, they value advice, they generate referrals and they require very little babysitting. And many have steady, if not huge, incomes.

Roulston himself regularly sends his clients missives that, in addition to containing financial advice, rail against blatant consumerism and speak to the importance of leaving as small an environmental footprint as possible. He says that living fairly, modestly and ethically — with a focus on socially responsible buying and investing, for example — appeals to his age group. If that belief system also happens to mean that they can save more money for retirement, all the better.

Royal Bank of Canada is targeting this group. It is talking to young people in a way they will listen — through their earbuds. This month, the bank is launching, on both its student banking Web site and iTunes, three financial advice podcasts aimed at helping those in their 20s — Generation Nexters — understand credit, budgeting and the financial realities of being a student.

“A lot of financial institutions are now recognizing that we have to put a concerted, targeted effort toward this market,” says Kavita Joshi, national manager of the client strategy group, student markets, at Royal Bank in Toronto.

The bank has done its homework and knows that “N-geners,” as this group is also known — which it defines as young adults aged 19-35 — are powerful potential lifetime customers. They also happen to be different from any other demographic group in history — in their Internet savvy, desire for wealth and relationships with their parents. Still, young Canadians share some predictable financial milestones in their early adult decades: attaining education, embarking on careers, forming families and buying first homes.

But building a business around the young adult market isn’t easy. It takes patience, according to Erika Penner, an independent advisor in Richmond, B.C., who says 10% of her clients are under 40, mostly in their 30s. Younger Canadians are usually too preoccupied with keeping their heads above wa-ter to think about long-term financial planning, she says. However, that doesn’t mean that they don’t need financial products. She says that insurance planning is often a good place to start with younger investors.

Those efforts will pay off, according to 29-year-old advisor John Trudel. When he joined the Winnipeg office of Investors Group Inc. two years ago, Trudel attempted the usual approach to generating business, targeting the high net-worth market.

“I realized in the first month or two that I was barking up the wrong tree,” he says.

He decided to target his peers rather than his parents’ peers — and he hasn’t looked back. “I found a natural fit,” he says.

Trudel speaks enthusiastically to those in their 20s and 30s, partly because, as a client of Investors Group for 10 years, he knows first-hand the benefits of starting early.

The investment advice Trudel received as a young adult enabled him to buy his first house and start building up the equity to put into other investments, including a rental property, long before many of his peers had graduated from university.

Trudel’s first question to potential clients is always whether they own a home; it’s a question that piques the prospects’ interest because many in that age group assume home ownership is out of their league.

@page_break@Pitching home ownership as the first step toward financial growth may well be just what this demographic ordered. A Bank of Montreal survey released in April, which shows that one-third of 21- to 34-year-olds are living with their parents, suggests they are saving for a down payment on a home.

Using an Investors Group strategy, Trudel arranges a loan that’s interest-free for six months, which the client deposits in an RRSP. The client then takes advantage of the Canada Revenue Agency’s Home Buyers’ Plan, which lets first-time homebuyers withdraw up to $20,000 from an RRSP tax-free to make a down payment on a first home. The client takes advantage of the tax deduction from the RRSP deposit and becomes a homeowner, thanks to Trudel’s advice.

Trudel doesn’t make any money in the transaction. “But I get a client for life,” he says.

The payoff begins when the new homeowners turn to him for insurance.

He now has slightly more than 300 clients, the majority of whom are between the ages of 18 and 40.

For his part, Roulston first worked with information-technology professionals but found he had nothing in common with them. He was drawn to health-care professionals, mainly female occupational therapists and physiotherapists between 25 and 35 years of age. “They were young, sporty and fun,” he says.

They also had healthy starting salaries in the $50,000-$60,000 range, so it was easy for him to set up programs that took advantage of what he calls “compound coolness.”

He now has a book of about 800 clients, served mainly by five other advisors working under the Roulston umbrella.

So, if you’re ready to zero in on the group, professionals with experience dealing with Gen Nexters offer the following advice:

> Keep It Real. Members of this generation have finely tuned BS detectors and will be turned off by blatant sales pitches. Their tolerance is particularly low for anyone who pretends to be something they’re not, says David Nowell, a professor of marketing at Sheridan College Institute of Technology and Advanced Learning in Oakville, Ont.

Nowell points to the outrage of fans of video-sharing site YouTube after the “Lonelygirl15” video blog, ostensibly posted daily by a teenage girl, was revealed to be a hoax. And there are many stories of marketers getting caught posing as unbiased contributors to product review sites, he adds.

But, perhaps, the worst transgression of all is the embarrassing move by some marketers to try to drape themselves in the generation’s culture, which can come off as insincere.

“We really need to differentiate between trying to be cool and speaking their language,” says Royal Bank’s Joshi. “There’s a difference between being superficially funky and cool vs taking their financial matters seriously while being able to have fun and be relevant.”

Roulston’s advice: “Practise what you preach.” His commitment to authenticity compelled him to fire two advisors on his staff who had purchased luxury cars that went against the firm’s ethical consumer/investor philosophy.

> Keep Them Interested. Not all young people are as interested in retirement planning as their parents.

“Retirement seems too far down the road,” Penner says of many in their 20s and 30s. “You have to hit 40 before you sit up and give your head a shake.”

In fact, if an advisor had tried to pitch retirement planning to Investors Group’s Trudel in his young adult years, he would have laughed his way out of the office.

“I’d be so turned off, because retirement is a long way off,” he says.

That’s why he focuses on helping clients break a plan down into realistic, tangible goals that can be reached within a year or two of planning. Reinforcing these aspirations with cards and e-mails is a great way to keep the young client motivated, he adds.

Some young people are saving for the future, however. Statistics Canada says 4% of RRSP contributors were under the age of 25 in 2005; 20% were between the ages of 25 and 34.

Peter Andreana, an advisor at Continuum II in Burlington, Ont., gave a presentation on money management to a group of new graduates at the University of Toronto in April. His talk focused mainly on debt management and saving — the “baby steps” of financial planning, he says. But when it came time for questions, he was in for a surprise.

“They were very interested in hearing more about RRSPs and retirement planning and what they should be doing,” he says. “I was totally blown away.”

> Keep Them Talking. The recent proliferation of blogs and text messaging tells us that Canada’s first completely wired generation is not shy about sharing its every thought. This could work to a financial advisor’s advantage.

“For young people, the first point of contact is often a peer, an online discussion board or a blog,” says Joshi.

Royal Bank is currently studying ways to create successful peer-to-peer marketing programs that respect young people’s need to conduct their own research and interact with others in order to gather information.

The generation’s emphasis on peer advocacy means referrals usually take care of themselves, says Trudel, who never ends an introductory client meeting without asking for three referrals. Most clients are only too happy to comply, he says, and the referrals can quickly multiply.

Over the past year, word-of-mouth marketing by a client from Brandon, Man., has translated into enough referrals to justify Trudel paying a weekly one-day visit to the city, which is 200 kilometres from his home base in Winnipeg. Trudel rewards clients for their referrals with football tickets and restaurant and retail gift certificates.

> Keep It In The Family. Some advisors offset the low profitability of 20- and 30-somethings by including only a smattering of the young investors among their older, established clientele. A natural way to do this is through family referrals.

Jeanette Brox, an Investors Group advisor in Toronto, says that 16% of her client roster (slightly more than 600 clients) are under the age of 39. “I thought very early on in my career that I needed to get to know the family members of my clients because they will be the beneficiaries of these assets,” she says.

Brox loves working with younger clients because their goals are often short-term and the products she recommends are different from those of her older clients. “Younger clients need a different approach to planning, as they are just starting out,” she says.

For instance, she may recommend critical illness and disability insurance, for which premiums are generally much lower for younger clients.

Also, because the younger clients are in the “building” stage of their financial lives, they need to make sure that their liabilities — mortgage, credit cards, student loans — are covered in the event of an illness or premature death.

> Stay Flexible. While all advisors understand that there’s no such thing as a static plan, those working with younger clients have to keep their pencils sharp; change is one of the things that define these two decades in life.

Roulston maintains that because the younger years are so unpredictable, planning for young people is never boring: “What I love about it is that I spend all this time coming up with financial plans for them and then, in six months, the plans become totally irrelevant because they decide to get married or they want to go travelling. We have to redo it. It’s fun.”

Penner has also had to react to the ever-changing nature of the lives of 30-somethings. One client couple for whom she drew up a full financial plan that had the purchase of a home as their short-term goal made a decision afterward to pursue costly fertility treatments — not something too many clients would consider if they were much older.

“Their decision was that the house can wait,” she says. “Life comes and changes things for you.” IE