Why target millennials when retirees have all the money?

United Income shoots for retirees, who control 80% of investable assets

New Morningstar and Omidyar-backed robo-advisor United Income targets the old. 

Robo-advisors have often been strung by a problem. They want to target young people who are most trusting of robots, yet young people have no money to entrust.

What’s the solution? According to new robo-advisor United Income, it’s to ignore young people altogether and go for old people who are rich.

United Income is a new US robo-advisor based in Washington DC. It is backed by data company Morningstar and eBay billionaire Pierre Omidyar.

In contrast to other robo-advisors which put millennials in their cross hairs, United Income launched with the explicit goal of luring in those aged 50-70. It wants to target this group because the elderly control roughly 80 percent of investable assets in the US, the company said in its press release.

United Income aims to be different from other robo-advisors by offering more than just a chance to grow a nest egg. It also wants to help retirees turn their assets into retirement income and provide extra services, such as advice on Medicare, Social Security and how to minimise tax exposure.

The government-facing part of United Income’s platform was built with the help of former government officials, who know the system inside out.

Like other robo-advisors, United Income runs a hybrid model, giving its clients the chance to speak with a human advisor on the phone or through email. But the hybrid comes at an extra cost and drags the annual fee on assets from 0.50 up to 0.80 percent.

This article first appeared on www.roboadvicenews.com