Tags: millennials | wealthy | investing | parents

Survey: Wealthy Millennials Tend to Invest Like Their Parents

By    |   Friday, 12 April 2013 01:27 PM

Wealthy millennial investors are not the know-it-all rebels that some may assume them to be, according to Merrill Lynch Private Banking and Investment Group’s Young High Net Worth Insights Survey reveals.

The survey of 153 investors aged 18 to 35 with at least $1 million in investable assets found subtle differences relative to their parents.

Only a small proportion of the survey participants prioritize wealth preservation over growth. Most want more wealth and they are willing to take on higher levels of risk to get it.

Editor's Note: Economist Warns: ‘Money From Heaven a Path to Hell.’ See Evidence.

But millennials are not turning to social media or to blogs for their financial and investment information. Instead, they are using traditional media sources such as business TV, newspapers and magazines. And the majority actually possess a lot of respect for their parents investment skills.

Less than half of the millennials surveyed considered their knowledge of finances and investing to be superior to their parents’. On the contrary, 69 percent claimed that they invest in a similar manner as their parents. An equal percentage said they do so because they believe those strategies still work.

A survey commissioned by Accenture, which included millennials who are far less wealthy, concluded that compared with baby boomers and Generation Xers, millennials are the most determined to learn to invest their money, but they are also the most distrustful of financial advisors.

Over half of the participants in the Merrill Lynch survey engage an advisor, but 72 percent still describe themselves as “self-directed” investors. This was not interpreted as distrust, but rather as a desire to maintain control and an indication of the value placed on independence.

Wealthy millennials expressed a clear willingness to work with advisors and in many instances to work with the same advisors that their parents use. But they are looking for slightly different attributes in these professionals. Having advisors who understand the needs and life stage of millennials and who communicate in a fashion that resonates with people in that age group were cited as the two most important qualities.

Millennials are often portrayed as a somewhat ungrateful and short-sighted lot with a spend-to-the-end mentality that puts family fortunes at risk.

In reality, “many young adults tell us they feel a tremendous amount of pressure to live up to parents’ expectations and to achieve their same level of success,” said Phil Sieg, head of the ultra high net worth client segment and solutions for Merrill Lynch Wealth Management.

The Accenture survey deemed millennials to be the most determined generation to pass along wealth to their families. And findings from Merrill Lynch reveal that even the more wealthy members of the demographic have their financial well-being on the radar.
“Our findings portray a younger generation that is ambitious, focused on the future, and that has a strong sense of responsibility to family, community and society,” said Michael Liersh, director of behavioral finance for Merrill Lynch Wealth Management.

“These wealthy millennials are savvy, independent and skeptical; they value expertise, question everything and intend to maintain control of their financial destiny, but admittedly lack a high level of knowledge about investing.”

Editor's Note: Economist Warns: ‘Money From Heaven a Path to Hell.’ See Evidence.

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Wealthy millennial investors are not the know-it-all rebels that some may assume them to be, according to Merrill Lynch Private Banking and Investment Group’s Young High Net Worth Insights Survey reveals.
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Friday, 12 April 2013 01:27 PM
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