Millennial investors still seek expert advice - survey

Added 12th September 2016

Investors under 35, the so-called Millennials, are slightly more willing to take advice from a professional financial adviser than those aged 36 and over, according to a survey by global asset manager Schroders.

 Millennial investors still seek expert advice - survey

The latest release from the Schroders Global Investor Study highlights the finding that 46% of survey respondents aged between 18 and 35 said they would like to improve their understanding of investments by speaking to a financial adviser, compared with 41% of investors aged 36 and over.

The survey involved 20,000 investors from 28 countries with at least the equivalent of €10,000 (£8,450, $11,200) each invested.

While financial advisers were identified as an important part of the investment decision-making process, doing their own web-based research was still more likely for millennials than older investors.

Half of investors (51% millennials vs 49% older) said they would consult a financial adviser the next time they make an investment decision but this was only slightly ahead of doing their own research; either by using independent websites (46% millennials vs 46% older), investment management websites (47% millennials vs 40% older) or investment provider websites (45% millennials vs 41% older).


Human touch

When it actually comes to making an investment decision, millennials were again more likely to speak to a financial adviser first with over half (51%) likely to want a human contact, compared with 49% among the 36 and over age group, according to the survey.

“Despite technological advancements and the advent of “robo-advisers”, where websites ask questions about risk and goals before offering investment solutions, most investors still prefer to speak to an independent financial adviser before making their final investment decision,” Schroders said.

More knowledge sought

Overall the Schroders Global Investor Study found around nine out of 10 investors wanted to improve their investment knowledge though there were disparities across the regions, with more Asian investors expressing a thirst for improved knowledge than European investors.

By countries, in Europe the Dutch were least likely to want to learn and Italians were keenest.

“The desire to learn about investments should serve as comfort to policymakers. By improving their understanding of investments and speaking to an independent adviser before making a final decision, investors could be prevented from falling into a financial trap,” Schroders said in a statement.

The 2016 study also found:

  • Only 13% of investors globally admit they have worse than average understanding of investment,
  • 63% couldn’t correctly identify what an investment manager or fund manager does,
  • Investors, on average, expected a 9.1% return on their investments annually.

Help needed

“We now live in a world of low interest rates, low growth and returns that are consequently lower than investors previously enjoyed. It is a world where policymakers are running out of options to boost growth and yet investors, confident in their own understanding of investments, expect near double-digit returns on their investments,” the company said.

Sheila Nicoll, head of public policy at Schroders, said: “There is clearly a need for affirmation ahead of making investment decisions, underlining the need for investment management firms and financial advisers.

“The world of investing can be daunting, and even more so now with the added complication of growing global political uncertainty. It is therefore essential that those in the know use their knowledge to those who need and want to know.” 

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About Author

Richard Hubbard

Group Editor

Richard Hubbard is the group editor at Last Word. He is responsible for the editorial content of International Adviser, Portfolio Adviser, Expert Investor and Fund Selector Asia. Richard previously worked for Thomson Reuters and has covered the financial services industry and investment themes from its offices in London, Singapore, Hong Kong and New York. Richard started his career at the Australian Financial Review in Sydney.


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