The evidence is mounting of a generation gap in investing and financial attitudes of wealthy households. A Bank of America study shows 75 per cent of young investors believe that traditional equities and bonds alone cannot produce returns that are above-average. The ‘2022 Bank of America (BOA) Private Bank Study of Wealthy Americans’ shows financial behaviours and values take shape early in life and live on in the legacies passed from one generation to the next. However, the findings point to a larger role wealth advisors and the financial services industry play in helping families transition wealth and meet the needs of the next generation.” Many people will forego traditional stock market investment during this changeover as 32 per cent of investors over the age of 43 do not believe that traditional stocks and bonds can generate above-average returns on their own, compared to three quarters of investors between the ages of 21 and 42. Older investors allocate five per cent of their investment portfolios to alternative strategies and 55 per cent to stocks. In contrast, young investors put 16 per cent in alternatives and 25 per cent in equities. Most millennials have made investments in cryptocurrencies and 80 per cent of the newer generation are looking to put money in private equity, commodities, real estate, and other tangible assets.
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