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GENERATION INVEST: GEN Z AND MILLENNIALS MORE LIKELY TO INVEST THAN OLDER COUNTERPARTS

ByAdam Myles

Jun 8, 2023
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GENERATION INVEST: GEN Z AND MILLENNIALS MORE LIKELY TO INVEST THAN OLDER COUNTERPARTS

  • Over half (52%) of 18-34-year-olds hold some form of investment, compared to fewer than two in five (38%) of those aged 55+
  • Almost a quarter of Brits invest to keep up with the continually rising cost of living (23%), as well as boosting their retirement fund (31%), and generating additional income (30%)
  • Stocks & shares ISAs are the UK’s most popular investment vehicle (22%), followed by general investment accounts (14%)
  • 17% of 18-34-year-olds invest in cryptocurrency, almost double the national average (9%)
  • A quarter of Brits (25%) with an annual salary of £20k or less hold investments

A new generation of Brits are trying their hand at investing as over half of (52%) millennials and Gen-Z (18-34-year-olds) take a stab at getting a return on their cash – more than any other age group, according to new research from Forbes Advisor[1].

The study analysed Brits’ investment[2] habits, revealing fewer than four in 10 (38%) of those aged 55-and-over invest despite being the wealthiest age group in the UK, and being nine times better off than the 30-34 age group[3].

The data reveals a shift away from the archetypal investor, suggesting investing isn’t the preserve of older, wealthier individuals with many years’ experience of financial markets. While many assume that investing requires large sums of cash, new data reveals that a quarter (25%) of Brits with an annual salary of less than £20k hold some type of investment, although this is still a lower rate than the general population (44%).

Looking at the reasons why Brits invest, priorities differ between age groups. For the wider population, future-proofing their finances is a priority, especially amid the cost-of-living crisis. Almost a quarter (23%) of Brits state that they invest to keep up with the exorbitant cost of living. Additionally, among the top three reasons given, consumers are investing to boost their retirement fund (31%) and generate additional income (30%).

 

 Reasons Brits Choose to Invest 

Rank Reason For Investing Percentage Of Brits
1 To boost my retirement fund 31%
2 To generate additional Income 30%
=3 To keep up with inflation/cost of living 23%
=3 So I can have an emergency pot 23%

 Source: Forbes Advisor

More than a quarter (27%) of 18–34-year-olds list generating additional income as their top reason, followed by keeping up with the cost of living (21%), and because they enjoy it (20%).

When it comes to how the public are investing, 22% are funnelling cash into stocks and shares ISAs, making it the most popular investment type in the UK.

However, cryptocurrency proved popular with the younger generation, with 17% of 18-34-year-olds holding the virtual currency, almost twice the national average of 9%.

 

Brits’ Top Five Most Popular Types of Investment

Rank Type Of Investment Percentage Of Brits
1 Stocks and shares ISAs 22%
2 General investment account 14%
3 Property 11%
4 Cryptocurrency 9%
5 Bonds and fixed-income securities 8%

 Source: Forbes Advisor

According to the data, many UK residents are also investing with smaller pots of money, rather than tens of thousands, as a quarter (28%) of individuals own a portfolio worth less than £2,500.

Andrew Michael, investment expert at Forbes Advisor says: “Nowadays, the technology contained in smartphones and trading apps offers private investors the levels of investment capability that were once the privileged domain of City dealing rooms.

“Being more tech savvy than any other generation possibly explains why younger investors are to the fore in our data and have turned to investing in greater numbers compared with older age-groups.

“Whether young or old, the need to future-proof one’s finances by boosting returns from market-based investments has become a priority for many, especially against the backdrop of a drawn-out cost-of-living crisis and stubbornly high inflation.

“It’s perhaps unsurprising, therefore, to see that Brits, even with relatively small amounts – as backed up by our findings – are looking to invest in the hope of achieving gains over the longer term.”

Forbes Advisor hosts useful investment guides on a range of topics, providing ideas and information on how to access the investment market, and which strategies and tactics can be deployed in pursuit of investment returns.