Editors' pick: Originally published July 8.
A significant chunk of young Americans aren't riding the bull market. Instead, they're turned away by a lack of financial literacy and money to invest.
In fact, only one in three Millennials own stock, according to a recent study from Bankrate.com, compared to approximately half of Generation X-ers and 48% of Baby Boomers. As a result, this cohort of young Americans, ages 18 to 35, is not taking advantage of surprisingly resilient indexes: the S&P, for example, is up 0.54% year to date, overcoming a monumental slump at the start of the year and bouncing back to pre-Brexit levels less than a week since the U.K.'s decision to leave the European Union.
Adults of all ages are wary of the investing in the stock market, with more than half of respondents reporting that they do not invest in the market. More than 50% say that they abstain from the markets due to lack of money. One in four say they don't know enough about stocks to invest, and others still find stocks too risky or don't trust stock brokers or financial advisors.
But that's particularly damning to the young.
"I find that people are overly pessimistic about the stock market and long term investing," said Larry Luxenberg, a financial advisor at Lexington Avenue Capital Management in New City, N.Y. "That's a shame, because for younger people especially, their greatest resource is time."
Despite the clear benefits of taking advantage of a longer time horizon for investment growth, younger Millennials, ages 18 to 25, report investing less than older Millennials, ages 25 to 35.