Millennial investors are more conservative and less trusting of financial advisors than baby-boom and Gen X investors, according to an Accenture survey of more than 1,000 high-income, digitally savvy U.S. investors.
The survey also revealed that millennials — those aged 21-30) are the most determined of the three generations to learn how to invest and pass along wealth to their families.
“Surprisingly, the millennial generation has emerged from two boom-and-bust cycles even more conservative about investing and more skeptical of financial advice than the generations that were hit hardest by the market,” said Alex Pigliucci, global managing director of Accenture Wealth and Asset Management Services.
“This poses a fundamental challenge for financial advisors who will see the greatest transfer of wealth in history from boomers to their heirs over the next several decades. But counter to prevailing wisdom, our research suggests millennials are a highly viable target for advisors.”
According to the survey, millennials are the most driven among the generations to build and pass along wealth, and the most interested in mastering investment strategy.
Forty percent said they are “determined” to pass along wealth to their families, compared to 25 percent of baby boomers and Gen Xers (age 31-45).
Forty-four percent of millennials described themselves as “extremely” interested to improve their understanding of investing compared to 38 percent of older respondents.
The survey points to unmet demand for online investor education and advisor-interaction tools that could increase millennial investing and help bridge the “trust gap” with financial advisors.
Presented with concepts for new online educational resources – ranging from online investment forums and educational web-based video services, to virtual advisor chats, webinars and social media – millennial respondents showed overwhelming interest.
“The behaviors and attitudes of millennials are not just a matter of long-term strategy for wealth managers; they are a leading indicator of the need for change today,” added Pigliucci.
“The recent financial crisis brought a sea change in attitudes toward investing and distrust for the financial industry across all generations. The explosion of digital and social channels in everyday life is simultaneously spilling into consumers’ relationships with their financial institutions.
“With half of all baby-boom investors currently active in social media and a vast majority active online, the innovations that will capture the millennial generation also will help capture the most coveted demographics among Gen Xers and baby boomers.”
According to Accenture’s research, there are more than 75 million digitally savvy investors in the U.S. with high-income, assets and education. This coveted investor demographic, upon which Accenture’s survey focused, makes up 44 percent of the online, U.S. population, aged 18-65, and represents approximately $27 trillion in total assets.
