Investors Are Proactive in Financial Planning Amid Economic Uncertainty

Retail investors are reevaluating what it means to be wealthy, their strategies for building wealth and their plans to transfer that wealth to future generations, according to a new survey from digital financial adviser Betterment. Betterment’s third annual “Retail Investor Survey” examined 1,200 investors across four generations (Gen Z, Millennials, Gen X and Baby Boomers) and found that more than 36% feel they would need a pre-tax income of at least $300,000 to feel wealthy, an increase from 28% in 2024.

That number also gradually increases as respondents get older, with 43% of Gen X and 45% of Boomers selecting $300,000 or more, according to the survey.

The survey found that even with broader economic volatility, investors are taking initiative when it comes to taking control of their financial planning and are looking for guidance.

Interestingly, younger respondents who said they use investment apps and AI, reported having superior portfolio performance and confidence in their retirement strategies.

The Need for Financial Advisers

Many retail investors also reported they still rely on traditional financial advisers to guide them through navigating the markets, pairing them with technology for access, ease of use and cost.

The survey found that 40% of respondents currently work with a financial adviser, with Boomers leading at 50%.

Although younger generations are less likely to use an adviser, they are the group most likely to believe they would benefit from working with one (Gen Z: 64%, Millennials 54%).

Investors who have a positive outlook (46%) about their financial situation are also more likely to have an adviser than one who is uncertain (34%) or who has a negative outlook (36%), according to the survey.

Gen Z is Ahead of the Savings Curve

When compared to Millennials, the survey found that Gen Z is engaging with their finances at a younger age. At 25, Gen Z Betterment customers have roughly double the assets on the platform than older Millennials at the same age (and roughly 25% higher than younger Millennials).

When it comes to appetite for risk, Gen Z is also more willing to stomach more of it. Sixty-four percent of Gen Z respondents said they are more willing to be exposed to risky investments, followed by Millennials (49%), Gen X (30%) and Boomers (10%).

Their willingness to take on more risk is due to them having “more time in the market before retirement,” according to Betterment.