By Brook Ptacek, IAC Student Intern
That is what it always comes down to: the nickels and dimes. So how does money impact millennial investors? Well the last myth to pull apart from FINRA and the CFA Institute’s sponsored study, entitled Uncertain Futures: 7 Myths About Millennials and Investing, is that “millennials overestimate the investable assets needed to work with a typical financial professional.” What the study showed us is that, in fact, millennials underestimate how much money they need to invest.
This is not surprising though because as the study clearly shows, and as my blog series started addressing in the beginning, money is tight for millennials. Millennials are not buying houses and not having children for that very reason, something FINRA and the CFA Institute point out as impacting millennial investment decisions. The top financial goal of 40% of non-investing millennials surveyed is to not live paycheck to paycheck. So of course a group that already is having difficulty just meeting their daily expenses is going to underestimate what kind of money they need in their savings to work with financial professional.
In sum, the FINRA and CFA Institute’s research seems to show that to get millennials to invest, they need to feel like they are in a position where they feel comfortable to hand over their rainy day money. And to do that, you need to educate them about where that money is going or companies need to offer more employer-sponsored retirement plans so a millennial’s natural curiosity takes over. Millennials are not adverse to the financial system, they’re just averse to losing their precious money.