Standard Life Investments

Millennials Investing

Who are the millennials, what motivates them and why should the investment industry take notice?

20 October 2016

Millennials Investing

Investing to reflect values is something the next generation - the so-called 'Millennials' - favour when it comes to putting money into stock markets. Millennials are the population of people aged between 18 and 34, born from the mid-1980s onwards. Understanding their principles - as well as their behaviour as tech-savvy consumers - will be key to unlocking their willingness to participate in stock markets.

Several different sources point to the fact that Millennials' appetite to invest money is growing, albeit from a low base. In a phone survey with 1,000 adults by, just 1 in 3 Millennials have money invested in the stock market. This compares to 50% of Generation X and Baby Boomers. The main reason for this is that, at this particular point in most Millennials' life, they do not have money to invest.

Perhaps reflecting the fact that people accumulate wealth as they grow older, however, the report shows that there is significant divergence between younger and older Millennials. Older Millennials are far more likely to invest than their younger counterparts. Bankrate found that 44% of those between the ages of 26 and 35 say they currently have money in stocks, either directly or indirectly.

Millennials will have money sooner or later. Over the next few decades, around $30 trillion in financial and non-financial assets will be passed from the Baby Boomer generation to Millennials in the US alone. This is a key point, because this money will eventually be invested in one form or another, either in the property market, in building businesses, or on stock markets, and it will flow in a direction dictated by Millennials' principles.

To understand how they might invest this money, it is important to look at the world in which Millennials have grown up. They have seen a period of rapid technological change, to the extent that technology plays a big part in how they choose and use services, and also consume news and make spending decisions. Thanks to the development of mobile internet, handheld devices such as smartphones and social media, peer-based information has become a major part of their decision-making process.

Being brought up as so-called 'digital natives' has shaped Millennials' values, priorities and expectations, which includes the way they think about money and investment. Several studies have been conducted to learn more about Millennials' values, an example being on climate change, on which they have stronger beliefs compared with their predecessors.

Given this point, could it be time for a fresh debate on how to adapt to the Millennials generation and its values? Being ahead of the curve in terms of new disruptive technology - some of which may allow Millennials to invest directly and instantly from their smartphones, for example - is one small part of the future picture. Another important point will be in communicating about investment products that may already exist and are already aligned with Millennials' values. These are the kind of discussions we hope to build as the lead sponsor of Good Money Week 2016.

Standard Life Investments is lead sponsor of Good Money Week 2016. Find out more at

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