As Generation X bids its farewell to their prime spending years, the millennials (Generation Y) are taking their place, marking the way with their unique investing values that are poised to reshape the global economy.
Combined with a totally different worldview and socially responsible market preferences, the millennials’ attitude towards investing is nothing similar to that of their older counterparts. For one, while investing has proven its benefits and advantages for the Boomers and Gen X, a huge percentage of millennials either don’t have enough money to invest or they just don’t know how.
The millennial generation’s fundamental mistrust in financial and banking institutions can be one of the factors that contribute to these low numbers. In fact, a study conducted by LinkedIn revealed that 71% of people belonging to generation Y would rather see a dentist than take the time to listen to a financial advisor.
Moreover, unlike the previous generations who focus more on profit and stability, millennials have been known to take the moral high ground, especially when investing. For this generation, an investment portfolio should be a form of self-expression, only opting for investment options that reflect their personal beliefs. Following a socially-responsible and more ethical line of thinking, regardless of profit, are the primary characteristics that describe millennial investment preferences. For this generation’s wealthier members, a “separately managed account” may be their best investment option.
On a more positive note, despite their lack of passion for investing, millennials are known to be great at saving. Several recent studies suggest that 71% of Gen Y is actually saving for retirement, allotting over 10% of their salary for the future. While the statistics on investing for millennials are not that impressive, experts believe that technology is the only way to alter their cynicism when it comes to embracing the investor lifestyle.