Investors Paying More Attention to Finances

The last year might not have been uplifting for many Americans, but a survey suggests it has made them more proactive in managing their finances.

A survey commissioned by online investing firm Scottrade found that 70% of surveyed investors indicated they are taking new action to better manage or monitor their finances this year.

As investors become more engaged, they also become more optimistic, according to the results of the survey. Just more than half (55%) of investors think the economy will improve within the next 12 months (the survey was conducted in July).

More than three-fourths (79%) of investors are confident that the stock market will provide long-term investment gains. About half (51%) of investors believe they’ll recoup their investment losses within the next three years.

“Investors are still stressed over personal finances, but stress levels have stabilized and attitudes are on the upswing,” said Chris X. Moloney, Scottrade’s chief marketing officer and executive director of customer intelligence.

Scottrade’s survey highlighted five actions investors are taking this year as a result of the economy:

  1. Checking accounts more frequently: 29% of investors are checking their accounts more often. Forty-three percent of investors check their accounts once per week or more. Generation Y (born 1983 to 1991) is the most active in monitoring their accounts; more than half (52%) check accounts once a week or more. Scottrade noted that Gen Y tends to be the most self-directed (and least likely to use a financial adviser).
  2. Examining their personal finance situation: 25% of investors are spending more time to better understand where they stand financially.
  3. Ensuring diversification: 19% of investors are ensuring their accounts have the right investment mix.
  4. Doing more research about investments: 18% of investors are trying to become more knowledgeable before they decide on investments. For most investors, particularly in Gen Y, financial news Web sites top the list of where they find financial information. When broken down by generation, Scottrade found that the sites draw 48% of Gen Yers, 41% of Gen Xers (born 1967 to 1982), 43% of Boomers (born 1946 to 1965), and 30% of Seniors (65 and older).
  5. Learning more about how the economy works: 16% of investors are taking steps to educate themselves about the economy.

“The economic crisis has had a big impact on changing the traditional ‘set it and forget it’ investment mentality,” Moloney said. “Investors are becoming more empowered in terms of their personal finances, and that’s likely boosting their confidence overall.”

The study was conducted online with members of Survey Sampling Inc.’s SurveySpot consumer panel. The survey had 1,143 participants at least 18 years old and involved in making investment decisions in their households.