Millennials trust financial advisors
What are Millenials looking for?
Millennials, or those born between 1981 and 1996, as defined by the Pew Research Center, have had a lot happen in a short amount of time. Millennials have faced a lot of uncertainty in the economy, which shows up in their investing trends.
While many millennials feel like they’re behind on their financial goals and retirement savings, they’re also expected to inherit more than $40 trillion from their parents and other family members in the coming decades.
Given the immense amount of money they will control shortly, millennial investment trends and habits can provide helpful insight into the future financial landscape. As the oldest millennials turn 40 years old, let’s look at some of the investment trends that have shaped the millennial generation and some of the places they still feel stuck.
The three big things about Millennials
- Millennials are highly interested in socially responsible investing
- 24% of millennials have $100,000 or more in savings
- 39% of millennials invest in cryptocurrency
Millennials are interested in sustainable investing
According to research from Fidelity Charitable, over 60% of millennial investors believe impact investing has more potential to make lasting change than traditional charitable giving.
According to a study done by The Harris Poll, 76% of older millennials think climate change is a severe threat to society and they’re willing to put their investment dollars into finding a sustainable solution.
A recent survey found that 24% of millennials owned ESG stocks, but 33% weren’t sure what ESG funds were. Women were more likely to hold this type of stock, at 25% of respondents, versus 17% of male respondents.
One in four millennials has more than $100,000 saved
More than 90% of millennials are saving for retirement while 32% are saving for their first home or looking to upgrade to a different house. Millennials are also the youngest generation to start saving, starting around age 24, compared to age 30 for Generation X and age 33 for baby boomers.
39% of millennials invest in cryptocurrency
While many of the younger generations are interested in cryptocurrency, digital currency is making significant gains among millennials. Almost 60% of millennial investors say that they hold some kind of digital currency, 38% said that they own cryptocurrency specifically, and 15% said that they possess a non-fungible token (NFT), which is a digital asset like bitcoin or dogecoin, but it replaces real-world objects like music, art, and videos.
What else do they invest in
Direct shares are the most popular investment for Millennials, followed by managed funds and exchange-traded funds (EFT) are third, with 23% of millennials choosing to invest in those. (The Motley Fool, Investopedia, Morning Consult State of Consumer Banking & Payments)
What should be the next step
To build up retirement savings, Buffett swears by one simple tip.
“Consistently buy an S&P 500 low-cost index fund,” he told CNBC in 2017. “I think it’s the thing that makes the most sense practically all of the time.”
Buffett advises against the practice of stock picking.
“The trick is not to pick the right company — the trick is to essentially buy all the big companies through the S&P 500 and to do it consistently, and to do it in a very, very low-cost way,” he told CNBC. “You do not want to ever get the impression that you can pick stocks.”
Start investing and keep going
There are numerous options online for younger investors wanting to build wealth or older investors that want to set aside more money that they can access before retirement.
Go to www.financialchoice.com.au and click on the link to financial choice direct portfolios for the easier way to invest directly in a range of green investments and direct ETF’s.
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