NEW YORK ( MainStreet)--The world of wealth is getting younger. Fully one-third (34%) of affluent Americans are now comprised of Gen X and Gen Y, with $100,000 or more in investable assets -- a substantial increase from the 21% mark of 2010, according to Cogent Research.
Baby Boomers continue to represent the largest generation of investors at 44% of all affluent Americans. Meanwhile, the so-called Silent Generation aged 67 and over is contracting. These older investors currently comprise just 21% of the affluent population, down from one-third in 2010.
Capturing a new generation of investors will require some diligence on the part of book-building financial advisors, as 80% of emerging investors (ages 21 to 29) and 68% of early career investors (ages 30 to 39) say they "make decisions and manage money on my own" according to the Hearts & Wallets Investor Quantitative Panel, an annual poll of more than 5,400 U.S. households.
The Young High Net Worth Insights Survey by Merrill Lynch finds that less than half (45%) of wealthy Millennials believe that their level of knowledge regarding financial and investment matters is greater than that of their parents. Fewer still (19%) would describe themselves as having a high level of knowledge regarding financial matters, and one-quarter admit they have very little knowledge."Our findings portray a younger generation that is ambitious, focused on the future, and that has a strong sense of responsibility to family, community and society," says Michael Liersch, Ph.D., director of behavioral finance for Merrill Lynch. These wealthy Millennials are savvy, independent and skeptical; they value expertise, question everything and intend to maintain control of their financial destiny, but admittedly lack a high level of knowledge about investing." Developing a relationship with these young investors through their parents may also be a challenge for advisors. The Merrill Lynch survey found that less than half (46%) of younger investors discuss financial matters with their parents. --Written by Hal M. Bundrick for MainStreet