Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.
In Practice November 11, 2008
Generation Yers Go Their Own Way
Advisers could take note that members of Generation Y might like to make their own investment decisions, but they are also interested in more sources of financial information than other generations.
Reported by Fred Schneyer
The 2008 American Investor Study, commissioned by online investment firm Scottrade, found that Gen Y uses more sources for financial information than any other generation, including Web sites, newspapers, television, magazines, radio, and financial experts. It is no surprise that Gen Y is the heaviest user of financial Web sites (79% use them, compared with 48% of the total population), but its members also are heavy users of newspapers and television programs.
The survey found that 51% of Gen Y (18 to 26) investors make all investment decisions themselves, compared with 40% of the total population. Just 37% of Boomers (43 to 64) and 32% of seniors (65 and older) say they make their decisions alone.
“Gen X and Gen Y are highly self-directed and use the Internet to make their own financial decisions, which signals a major generational shift,” said Chris X. Moloney, Scottrade executive director of Customer Intelligence and chief marketing officer, in a news release. “Gen Y is often cited as being an independent-minded generation, and when it comes to investing, this stereotype holds true. They largely are taking financial matters into their hands.”
According to the announcement, more than one-third of Gen Y rate their investment decisions as “better than average,” compared with just one in four among the total population. Just 20% of Gen X (27 to 42), 26% of Boomers, and 23% of seniors claimed their decisions were better than average. Only 1% of Gen Y believe their decisions are below average.
The study, conducted online, received a sample of 1,031 respondents between July 11 and July 23. The study included participants who were at least 18 years of age and either shared responsibility in making financial decisions or were the sole financial decisionmakers in their households.
How Americans make investing decisions:
| Total | Gen Y (18-26) | Gen X (27-42) | Boomers (43-64) | Seniors (65+) | |
I seek advice from others before making my decisions | 50% | 44% | 47% | 54% | 54% |
| I make all the decisions myself | 40% | 51% | 45% | 37% | 32% |
| Someone else makes most of the decisions for me | 10% | 5% | 8% | 9% | 14% |
See also: “Y Not?,” “Generation X,Y Could Use More Savings Help,” “Talking to Twentysomethings“