What You Need to Know
- Some 40% of HNW millennial investors hold up to 10% of their total portfolio in crypto.
- They hire financial advisors to manage their portfolios at a higher rate than older investors.
- Regarding financial advice, 70% of high-net-worth investors said ensuring they don't run out of money in retirement is the biggest consideration.
Fifty-eight percent of high-net-worth millennial investors say digital trading apps such as Robinhood and Coinbase offer them the freedom and flexibility to invest the way they want, according to a new survey by Wealthramp, a fiduciary advisor matching platform.
Some 40% of investors in this age group own up to 10% of their total investments in Bitcoin and crypto.
Although they fully embrace emerging and alternative assets, millennial investors are hiring financial advisors to manage their investment portfolios at a higher rate than Generation Xers and baby boomers, according to the survey.
The results showed differing investment behaviors and outlooks among generations on how they want to receive financial advice. But investors of all ages and asset levels share a desire for more education and expect financial advisors to help them become smarter investors in the year ahead.
“Many consumers today are digitally engaged and committed to learning how to capitalize on new market opportunities driven by crypto and other emerging assets,” Pam Krueger, founder and chief executive of Wealthramp, said in a statement.
“At the same time, 43% of investors don’t currently own any digital currencies and a third say they have no interest in using digital trading apps. As the industry enters a new frontier of investing, the stabilizing force will be the fee-only financial advisors who have the expertise to create strategies that are risk-adjusted and fee sensitive to meet their goals.”
Dynata conducted the survey in November among 1,003 U.S. adults with investable assets of $250,000 to more than $2.5 million.
Aspects of Financial Advice
Asked to think about the most important aspects of receiving financial advice in the future, 70% of high-net-worth investors said having full financial planning to ensure they do not run out of money in retirement is the biggest consideration.
Sixty-five percent said financial advice provides education that helps them become smarter investors, and 64% said it results in more efficient management of ongoing investing tasks to optimize performance, such as rebalancing and tax-loss harvesting.
Gen Xers and boomers hold similar views, but millennials’ outlook on the future of financial advice is more digitally focused and purpose-driven, the survey found.
Eighty-three percent of younger investors cited better coordination between digital tools and robo-advisors and their financial advisors as the most important aspect, followed by frictionless integration of digital currencies into portfolios and access to new and additional investment vehicles that achieve socially responsible investing.
“Today, most people buy and sell crypto directly using crypto exchanges since the established discount brokers like Fidelity and Schwab currently only allow you to invest in crypto futures, ETFs that invest in crypto futures or products like the Grayscale Bitcoin Trust, which have relatively high fees,” Jeffrey George, a fee-only investment manager on Wealthramp, said in the statement.