Young investors show what a difference a decade can make in shaping financial outlook.
Forty is the new 30 in many aspects of life, but when it comes to investor confidence it’s the young investors who are in their prime.
New Millionaire Corner research examining the attitudes of young investors and their middle-age counterparts finds pessimism over personal finances and the state of the economy increases significantly among investors in their 40s.
The 40-somethings surveyed this month by Millionaire Corner reveal a much gloomier outlook on the job and housing markets - and the chances of a double-dip recession – than young investors. They also take a dimmer view of their own financial situation.
“Young investors are taking more of the brunt of the weak job market, yet they seem almost wildly optimistic compared to investors in their 40s,” said Catherine McBreen, president of Millionaire Corner. “The older demographic is feeling multiple financial stress points – in particular, saving for college and retirement in a down economy.”
Investors in their 40s are much less likely than young investors to believe President Obama’s new job plan will work. Fewer than 18 percent believe that the plan will produce the desired results, compared to 28 percent of investors younger than 40 who have faith in the plan.
The 40-something demographic is significantly more likely to have a close friend or family member who is looking for, but unable to find work. The situation applies to 60 percent of investors in their 40s, but only 44 percent of young investors.
They older investors appear more frustrated with Washington politicians and have less hope that the president and Congress will be able to work together to make a workable jobs plan. Fewer than 7 percent of investors in their 40s expect the parties to cooperate, compared to more than 20 percent of young investors.
The middle-age express greater pessimism about the housing market and are more likely to believe the nation is entering another recession. More than 46 percent of investors in their 40s anticipate a double dip, compared to 38 percent of young investors.
The optimism gap extends to perceptions of financial well being with 34 percent of 40-something investors reporting they are better off now than they were a year ago. In contrast, 40 percent of young investors say they are better off today and they are also more optimistic about the future.
Well over half (55 percent) of young investors expect to be better off financially in a year from now, compared to 39 percent of investors in their 40s. The young investors are also slightly more bullish on the real estate market with 56 percent agreeing that now is a good time to buy real estate, compared to about 53 percent of investors in their 40s.
Hope for the next generation runs highest among young investors. More than 42 percent say they believe the next generation will live better than the current one, while less than 28 percent of investors in their 40s believe the next generation will be better off.