Are Younger Generations Investing?
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Are Younger Generations Investing?

Photo by:   charlesdeluvio, Unsplash
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Sofía Hanna By Sofía Hanna | Journalist and Industry Analyst - Fri, 08/26/2022 - 13:26

Generation “Z,” those born between 1994 and 2010, is beginning to worry about saving and investing. While this generation understands the importance of investing, they feel their income is insufficient to do so. Many people in this generation worry about their day-to-day finances and fear they will not be able to retire comfortably, found an analysis by BlackRock.

 

The Gen Z generation was born in a relatively healthy economy and low unemployment. This changed once the pandemic hit, putting them under heightened uncertainty at the beginning of their adult lives. However, this generation’s reach and understanding of technology is a point in its favor, said BlackRock.

 

This generation is taking advantage of technological tools to invest. According to a CreditCards.com survey, Gen Z investors were nearly five times as likely to report that their financial advice came from social media. Additionally, 80 percent of those in this generation were more likely to seek financial advice, while only 64 percent of Gen X and 60 percent of Baby Boomers were interested in seeking advice. 

 

According to Deloitte’s Gen Zs and millennials survey, the generations are deeply worried about the state of the world and are struggling with financial anxiety while trying to invest in environmentally sustainable choices. About 29 percent of those in Gen Z surveyed selected the cost of living as their greatest concern. This unease about the cost of living is likely a symptom of the times, given high inflation levels. Gen Zs “ do not feel financially secure personally and, at a broader societal level, they are deeply concerned about wealth inequality,” reads Deloitte’s survey. As a result, Gen Zs are more willing to spend money in the short term for sustainability, but some hesitate to make large, long-term financial investments due to financial constraints.

 

According to 2021-2022 figures, in the US, over 50 percent of the population has an account in a brokerage house; in Mexico, only 2 percent of adults do. Mexican brokerage house GBM reports that those between 18 and 35 years of age are mainly investing in Amazon, Tesla, Apple, Netflix and Google through its digital platform GBM+. However, less than 30 percent of the platform’s users are women as they are less inclined to take risks than men, reports GBM. In Mexico, women have traditionally taken the role of homemakers, which may lead them away from money-making activities, as previously mentioned in MBN. However, Gen Z is one of the most diverse generations until now and has a favorable view of the nation’s growing racial and ethnic diversity. So there is an opportunity for them to put behind the prejudices that block others from investment.

Photo by:   charlesdeluvio, Unsplash

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