When it comes to staying in touch with younger investors, face-to-face or phone contact trumps social media outlets like Facebook, Twitter or LinkedIn.
That, according to a new survey from Merrill Lynch Private Banking & Investment Group, is just one of the findings to keep in mind about young investors. And the results from the February survey, like the preference for direct communication, show that younger generations are taking cues from their parents when it comes to how to approach investing.
Of the respondents, 69% said they believe their parents approached investing the right way versus 31% who said their parents did not; 65% of respondents said they invest in ways similar to their parents versus 35% who said they do not; and 65% said they think their parents’ investment approach still works today versus 35% who said it does not.
But younger investors also said that they are lacking the financial knowledge that their parents have. Just 45% said they have more investment knowledge than their parents, while 33% said they know less about investing than their parents and 22% said they are about equal. And while 56% said they are moderately knowledgeable about investing, 25% said they have very little knowledge and just 19% said they are very knowledgeable.
When it comes to accessing information on financial investments, most young investors turn to traditional media, including general television news, with 67% of respondents; business television news, 58%; national newspapers, 55%; and magazines, 52%. By contrast, just 27% of respondents said they look to social media or blogs to stay well informed.
“The key piece here is younger investors don’t know it all, they’re not looking to social media to get all the answers,” says Michael Liersch, director of behavioral finance at Merrill Lynch Wealth Management. “In fact, they’re really looking to parents and advisors to offer advice and guidance and they really want it.”
Lorie Konish is Managing Editor of On Wall Street, a SourceMedia publication.
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