Millennials will make up 75% of the work force by 2025, and $30 trillion in wealth may pass down to them, according to projections by Wells Fargo Asset Management. However, the firm also found that many in that group are still financially dependent and are seeking help to overcome anxieties about money.
A recent survey by Wells Fargo found the Millennial generation’s top 3 financial intimidators include saving for the future, knowing how to invest money and sticking to a budget. However, 77% lack a financial adviser. Of this group, 39% said they wanted one.
But many Millennials are leery of approaching advisers. For example, seven out of 10 said the Great Recession made them skeptical of “stock market experts.” Still, 74% said it would be easier to stomach the ups and downs of the market if their investments made a positive impact on the world. In fact, the survey found that some are motivated to use their money toward that type of goal.
These sentiments are reflected in other studies that indicate heightened Millennial interest in environmental, social, governance (ESG) funds. These vehicles invest in companies screened for engaging in positive ESG practices through their business. Wells Fargo’s survey found that, if given $1,000, 86% of Millennials would be motivated to invest that money in a company that makes the world a better place through its products.
Still, some in this generation would need to overcome a wealth of financial hurdles before they can begin investing. Wells Fargo found that 69% want to get over their anxieties about money. And, even though 83% said “they play an active role in their financial lives,” only 68% of these feel in control.
In addition, many studies indicate Millennials are particularly burdened by student loan debt, and this is getting in the way of saving for retirement. Taken together, these issues can substantially impede the future financial wellness and capacity to create wealth for a large portion of the Millennial population. Considering the group’s potential footprint in the work force, these trends can have significant effects on the American economy for the long term. But Millennials are also willing to change if given a nudge in the right direction.
Wells Fargo concludes, “The Millennial financial mindset may be strained by anxieties and intimidations, but it is uplifted by a desire to change.”