The student debt crisis is getting worse. While that’s bad news for most, it’s great news for the retail wealth management industry. With 43.2 million Americans carrying $1.71 trillion in student loans—and those stats climbing higher by the minute—the market for student loan debt management is a tremendous opportunity for financial advisors. But student loans are complicated, and advisors need to fully understand the landscape to deliver value to clients, acquire new business, and maximize new net assets.
If you’re considering adding student debt repayment solutions to your list of financial services, this is what you need to know:
A smarter student loan strategy accelerates other financial goals.
Federal guidelines state that monthly student loan repayments should add up to 10 percent of the borrower’s gross income. But what else could a client do with that chunk of income?
Debt repayment delays other financial goals like buying a house, saving for retirement, and investing. And fewer people in the position to make new financial commitments means fewer clients—and lower profits—for advisors.
Luckily, there are a few different ways to lower monthly student loan payments and free up discretionary funds. Having the know-how to help clients find better repayment programs, compare different refinancing options, and accelerate paydown is essential to creating value for student loan borrowers—and to growing net new assets.
Student debt management is more relevant than ever before.
While President Biden could technically still cancel student loan debt, the news that his annual budget doesn’t include forgiveness is less than promising. And with the end of federal suspension approaching this fall, consumer demand for smarter, more strategic student debt management will be higher than ever before.
This inflection point presents a game-changing opportunity for financial advisors, and firms that rise to the occasion with student loan repayment assistance will reap the rewards.
Student loans aren’t just a problem for Millennials and Gen Z.
It’s true that 35-year-olds carry the most debt, and that 18- to 29-year-olds are twice more likely to have student debt than any other age group. But that doesn’t mean that student loans are exclusively a young person’s problem. In fact, the 60-plus crowd is the fastest-growing borrower demographic, and Baby Boomers account for 20 percent of the national student debt balance.
Student loan repayment services are a generational win-win for wealth managers. Assisting younger clients manage their debt will lead to higher net worths and stronger, more profitable relationships with their financial advisors; helping older clients navigate student debt will reduce the chance of derailed retirement plans and unlock funds for other financial products.
FutureFuel.io is the preferred student debt repayment solution for advisors.
FutureFuel.io offers next-gen tooling that uses predictive analysis and data intelligence to help student loan borrowers lower monthly payments, accelerate their payoff timeline, and convert microtransactions into additional payments. The average borrower reduces their student debt paydown by half a decade and $15,000—outcomes that have established FutureFuel.io as the most comprehensive and innovative student debt platform in the industry.
As a retail wealth management advisor, offering student loan solutions can accelerate the growth of your practice:
Attract and retain more clients
High-demand student debt repayment services from FutureFuel.io meet millennial clients where they are: online and indebted. Leveraging FutureFuel.io unlocks greater value from younger clients who would have otherwise been forced to spend discretionary cash on student loan payments — instead of accumulating wealth.
Obtain and grow assets under management
FutureFuel.io’s solutions help borrowers optimize and accelerate their student debt paydown plan — and save significantly over time. By redirecting this newfound discretionary cash into wealth accumulation vehicles, advisors can grow and expand net new assets under management faster.
Earn brand halo status with empathy-rich digital experiences
The new generation of feeders demands modern, mobile-first, fintech-forward experiences. FutureFuel.io delivers a turn-key, end-to-end digital experience that immediately creates deeper, more meaningful connections.
Bolster estate planning services
The FutureFuel.io platform can be used to pay off a child or grandchild’s student debt either in one lump sum or with scheduled payments overtime, unlocking a new intergenerational wealth transfer strategy for estate planning clients.
Broaden financial wellness services
Smarter student loan repayment is an essential part of holistic financial wellness. By offering the tools borrowers need to more strategically pay off their debt with FutureFuel.io, advisors can become relevant to a broader market of clients who want to build wellness and wealth.
Deliver data-driven value
FutureFuel.io’s personal account aggregation services can provide greater visibility into clients’ income and transaction patterns. This data is an invaluable tool for retail wealth management advisors hoping to deliver more value to their clients and ultimately gain a greater share of wallet.
Deepen client relationships and trust
Student debt is an extraordinary financial stressor for borrowers — and retail financial advisors who help relieve that stress by offering student loan repayment solutions with FutureFuel.io will build their clients’ trust faster and have stronger long-term relationships.
If you’d like to learn more about how FutureFuel.io is driving results for wealth management industry leaders, sign up for a demo today.