Today’s investors believe they’re on track to reach key financial milestones, including starting to save for retirement and opening an investment account, earlier than their parents did, according to a survey by Bank of America.
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Bank of America surveyed over 2,000 Americans, including those age 25 and older with investable assets between $100,000 and $1 million, and 18- to 24-year-olds with between $50,000 and $1 million.
The survey found 95% of respondents include saving for retirement among their financial priorities, along with paying off debt (94%) and owning a home (97%). Eighty-four percent of respondents said they’re on track, or already have, knocked at least one financial milestone off their list earlier than their parents did, and 53% of ambitious respondents are eyeing five traditional financial milestones.
However, only about 53% of respondents have started to save for retirement, and 54% have opened an investment account. The survey also found that along with these traditional milestones, today’s investors value nonfinancial measures of personal success, such as good health (63%) and a supportive social network (59%).
Older respondents are generally happy with the financial decisions they’ve made over the past 20 years, the survey found, but a third say there are things they wish they had done differently, including saving more (66%) and earlier (59%), and starting to invest earlier (61%).
Tellingly, most respondents are investing on their own, or mostly on their own. Twenty-eight percent rely entirely on an advisor for investment advice, and 9% use a robo-advisor. The survey found 16% use an advisor to inform their own decision making.
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“The health crisis has caused many people to take stock of their life priorities and to control what they can during a period of uncertainty,” Aron Levine, President of Preferred and Consumer Banking & Investments at Bank of America, said in a statement. “In addition to getting their finances in order, people are looking ahead at new possibilities, plotting a course for their future, and engaging with educational resources and advice that will help them make informed financial decisions and pursue new and exciting goals for themselves and their families.”
Almost half of respondents said the pandemic hasn’t affected their risk tolerance, but the 44% who said it has are split between more aggressive and more conservative strategies. Younger investors are among those who said they’ve become more aggressive.
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Danielle Andrus works as an editor for The Financial Planning Association® (FPA®). Over the past 15 years, she has worked in various capacities, including writing and editing. Andrus has worked for several notable publications and outlets and spent more than seven years as the executive managing editor at ALM Media, publisher of Investment Advisor magazine and ThinkAdvisor.com. Before that, she was online editor for Summit Professional Networks, where she oversaw newsletter development for four magazines, including Benefits Selling, Senior Market Advisor, Boomer Market Advisor, and Bank Advisor.
