Remember when Millennials were best known for being broke and living with their parents? Yeah, those days are over.

906
0

It’s 2021 and the Millennial generation is entering its prime earnings years (the youngest Millennials today are around 35, if you can believe it). As a result, they’re entering the investing market in a big way, with more confidence than many of their older peers.

Remember when Millennials were best known for being broke and living with their parents? Yeah, those days are over.

It’s 2021 and the Millennial generation is entering its prime earnings years (the youngest Millennials today are around 35, if you can believe it). As a result, they’re entering the investing market in a big way, with more confidence than many of their older peers.

By the numbers: According to a new survey from Etrade, nearly three out of four (72%) millennial and Gen Z investors (ages 18 to 34) said they’re confident in their portfolio decisions. That’s up from just 56% who felt this way in 2020. And this is far ahead of the general investing population, of which only 57% feel confident in their decisions at the moment.

Is this due to inexperience? Maybe. According to a recent Schwab survey, 15% of respondents had only started investing in 2020, 2/3 of which were Millennials and Gen Z.

Why the rest of us should care: But, experienced or not, these younger investors are having a big impact on the market as a whole. That’s because every market needs buyers and sellers. Buyers who are willing to take on some risk in hopes of later returns and sellers who want to move to more secure asset classes as they approach retirement. 

Fortunately for Boomers and Gen Xers, today’s younger investors have a higher risk tolerance than their parents did at their age, and are ready to step in and buy. According to the survey, 70% of Millennial and Gen Z investors reported an increase in their risk tolerance this year, well above the 47% of all investors who feel this way.

My take: As mentioned, this is good news for soon-to-be retirees and retirees alike. The U.S. economic system is built on a delay — just as we all pay into the Social Security trust fund over the course of our careers, our investments during those decades help to support long-term market gains that benefit everyone, including those who are living on that money in retirement. A large generation like the Millennials needs to be actively investing to support the Boomers as they enter retirement and that seems to be happening at last.

Previous articleWhat You Really Need to Know About All Those Ridiculous Asking Prices for Homes
Next articleTop Ten High-Yield and Online Savings Accounts

LEAVE A REPLY

Please enter your comment!
Please enter your name here