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The Unique Relationship Between Millennials And Their Financial Advisors

More than older investors, Millennials consider the tax implications of investments, and the social responsibility of the companies they invest in. 

| BY Kent McDill

In America, when you are born you are immediately assigned a Social Security number. You are also assigned a generational tag.

That second step is more unofficial, but those born between 1981 and 1997 are unofficially referred to as Millennials, and today their age ranges between 18 and 34. Because of their age, Millennials are now coming into their own financially, which is why so much attention is being paid to how they invest the money they are now in possession of.

Spectrem’s new study, The Investing Habits of Millennials  examined the generation of investors, and examined how they relate to the financial advisors with whom they work.

A significant percentage of Millennials credit their financial advisor as a factor in their obtaining wealth. Among Millennials with less than $1 million in net worth, 25 percent credit their advisor. Only 14 percent of those with more than $1 million in net worth do so.

(To learn more about Millennials, take advantage of an exclusive opportunity to preview the Perspective by clicking here. Additionally, you can click here to purchase the Perspective).

Millennials are slightly less sure of themselves when it comes to investment knowledge than those investors that came before them (experience probably playing a factor in that). Among the Millennials with a net worth below $1 million, 17 percent consider themselves very knowledgeable about investments. Those with more than $1 million in net worth are more secure in their knowledge (25 percent).

Perhaps because they are still relatively young, Millennials have less concern over investment issues than older investors. Among a list of six choices given study respondents regarding investment selection factors, Millennials only cared more than older generations of investors about tax implications of investments and the social responsibility of investments.

Among Millennials with less than $1 million in net worth, 77 percent said they considered the tax implications of investments. Only Baby Boomers (two generations removed) came close at 74 percent.

However, Millennials with more than $1 million in net worth had fare less concern regarding tax implications, 75 percent to 78-83 percent among older generations.

The social responsibility issue was standard for Millennials in both wealth segments. Among those with less than $1 million in net worth, 40 percent consider social responsibility, while those with more than $1 million in net worth, 39 percent expressed concern. Among the older generations, concern about social responsibility topped out at 37 percent and dropped to 22 percent among World War II investors with more than $1 million in net worth.

 



About the Author


Kent McDill

kmcdill@spectrem.com

Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.

In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.

McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.

McDill is the father of four children, and an active fan of soccer, Jimmy  Buffett and all things Disney.

 


 

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