An overdraft … is that someone who checks your first draft?

An overdraft … is that someone who checks your first draft? Financial advice. Main image: Alex Oakenman,
Written by Chris Skinner

Financial advice is important for those who have no idea what a loan even looks like, says Chris Skinner.

I got into a conference this week (for a change) where the presenter of a robo-advising wealth manager got into a bit of a Q&A scuffle with an audience member. Felix Niederer, founder and CEO of Zurich-based startup True Wealth, showed the stats for its customers.

True Wealth statistics

Most of them are over 30, and the real $’s are in the over-40s age bracket. Felix said this is because wealth is something you accumulate over time. You don’t tend to be that wealthy when you’re 18-35 years of age, as you have other priorities.

The audience member said that maybe it was that their site was designed to attract older clients, and if they designed it differently they would get younger ones. Felix countered that the average age of a customer of a Swiss private bank is 67.


I often hark back to conversations I’ve had with folks like Mark Mullen (CEO and founder of Atom Bank) and Matthias Kroener (CEO and founder of Fidor Bank), who both assert that their customers are not millennials, but Gen X and above. This is because these demographics are not only comfortable with money – they’ve had a salary, bank account and mortgage for some time in most cases, but they also have money – they’re no longer yearning, but earning.

This is a critical point that I think is forgotten by many folks who believe face-to-face interaction, advice in-branch and an ability to talk about money is unimportant. It’s just all done in an app, they say. I agree it’s all done in an app for those who have experience of money, but for those just embarking on that journey who have no idea what a loan even looks like, it’s a totally different story.

Managing money

I’m reminded of this when I received an email yesterday of lighthearted research here in the UK by the Nationwide Building Society. The research was conducted in August 2016, and involved interviews of 500 undergraduates and 614 parents of children who are about to go, currently at, or recently graduated from university. Almost seven in 10 (69%) said they were taught insufficiently about finance and were ill prepared for student life, with nearly a third (30%) saying they taught themselves everything they know about how to manage money. Students polled also admitted that the lack of knowledge around budgeting didn’t stop them being frivolous with their student loan; 29% said they spend it all within a few months of receiving it, and just over one in 10 (11%) confessed to spending it in the first month.

The student loan that’s meant to be for rent, food, study and fees, is instead spent on:

  • nights out (67%)
  • nice clothes (66%)
  • holidays (30%)
  • a car (8%).

This doesn’t surprise me – I was a student once, but I remember that my trust was in mum and dad to be the “lender of last resort” if I got into trouble. According to Legal & General, the Bank of Mum & Dad lends £5bn a year in the UK alone, and if the Bank of Mum & Dad runs dry, maybe it’s time to ask someone else’s mum and dad to help you out.

So when I hear all these pontificators saying that kids and folks in their 20s don’t need advice, support or education with money – which is what banks should give (if they were ethical) – then I think this video from the Nationwide study puts it all in context (do watch this, it’s very funny):

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– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Main image: Alex Oakenman,

About the author

Chris Skinner

Chris Skinner is an independent commentator on the financial markets through the Finanser, and chair of the European networking forum the Financial Services Club, which he founded in 2004. He is an author of numerous books covering everything from European regulations in banking through to the credit crisis, to the future of banking.

1 Comment

  • Seems to be a discussion about whom you want to gather assets from and the value proposition you offer in response. So most of the big funds groups prefer the wealthy, which in practice mostly means people 50-65. If you’re going younger, financial education needs to be a big part of the proposition … but that’s been true of all generations. I like this example from Virgin Money.

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