A new survey from Bankrate.com shows that cash is the favorite long-term investment of the youngest American adults, aged 18 to 29.

That's not a good sign, says Greg McBride, Bankrate's chief financial analyst.

Editor’s Note: Retire 10 Years Earlier With These 4 Stocks

In the 18-29 demographic, 39 percent say cash is their No. 1 choice to invest money they don't need for at least 10 years.

That compares to only 13 percent who selected the stock market.

"The preference for cash and aversion to the stock market among young adults is very troubling, considering this age group has the biggest retirement savings burden," McBride said in a statement.

"They won't get there without being willing to assume a little short-term price risk in their long-term money."

Overall, 25 percent of Americans chose cash as their favorite long-term investment, while 23 percent selected real estate, 19 percent opted for stocks and 14 percent chose gold and other precious metals.

Investors of all ages appear to be reluctant to put money in stocks for the moment. U.S. stock mutual funds saw a net outflow in June for the second straight month, according to Morningstar.

"I think that has to do with the fact that the stock market appears to be fully valued," Michael Rawson, an ETF analyst at the firm, said on Morningstar.com.

"If we look at our [Morningstar's] price/fair value estimate, driven by our equity analysts, the stock market is at 103 percent of fair value."

Editor’s Note: Retire 10 Years Earlier With These 4 Stocks

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