2 out of 3 millennials, Gen Xers turn to employers for investment advice
Use of employer-sponsored programs has increased to almost half (49%) of all households, up from 39% in 2010, says report.
With the proliferation of smartphones and laptops, everyone has the internet at their fingertips nowadays. So perhaps it’s no surprise that people are turning to an ever-increasing number of financial sources for information about their investments. According to a new study by research firm Hearts & Wallets, 43% of households used seven or more sources of financial information in 2021, and that number rose to 84% for millennials with over $100,000 in assets.
Among those sources of information include employer-sponsored plans, which millennials are particularly likely to take advantage of: 2 of 3 Gen X and millennial households rely on employer-sponsored programs to some degree, with a jump in the past year. Only 1 in 3 baby boomer households uses an employer as a source of investing information and advice.
“Customers and prospects are interacting with more sources than ever to make investing decisions,” Laura Varas, the CEO and founder of Hearts & Wallets said of the survey findings. “To craft service models and distribution strategy, firms will want to understand investor behaviors at the national level, but more importantly for their specific design targets. It’s essential to recognize the differences by generation and other segmentation variables on channels that influence investor purchasing decisions.”
Related: 3 in 4 Americans worry about making bad investment decisions
Other findings of the survey include that as many as 65% of all households want to manage their own money. Only 12% saying they wanted to delegate their investment decisions – a significant decrease from 2010, when 20% of households wanted someone else to handle their investment choices.
The survey also found that a fair number of individuals used financial professionals. They were rated as the top source of financial investment information aside from oneself or one’s partner, according to the survey, with 71% of individuals saying they used a financial advisor in 2021.
Additionally, 3 in 5 people who say they do their own financial investments also use some form of financial professional. However, only wealthy baby boomers and Gen X ranked financial professionals as their primary source of investment information.
Other major sources of financial information include online resources, which 57% of respondents used – representing a significant jump in recent years. Use of employer-sponsored financial plans has also increased, with two-thirds of millennial and Gen X households taking advantage of these plans, and 92% of millennial millionaires, according to the report.