Issue link: https://resources.envestnet.com/i/1527494
Increasing Market Skepticism Stock market fluctuations, volatility, negative economic forecasts, rising interest rates, political uncertainties, and inflation are just a few of the factors influencing the attitudes and actions of affluent investors. In the last few years, these challenges and uncertainties have created significant impact. One key finding uncovered in the study: 54% of Affluent Americans say recent fluctuations in the market have made them skeptical of investing. Drilling down into the reasons for this skepticism, we learn that among older generations market volatility is the leading challenge (64% for Boomers and 57% for Gen X) while lack of knowledge or familiarity is cited as the leading challenge for millennials (45% for Older Millennials and 38% for Younger Millennials). When trying to reach their financial goals, investor approaches manifest very differently depending on the age and income of the investor. For advisors, this underscores the importance of individualizing a financial plan. Affluent older generations were significantly more likely to become more cautious about their spending, while Affluent younger generations were significantly more likely to realize they need to save more, learn more about the stock market, and start looking for a higher paying job. How have recent fluctuations in the stock market impacted your financial planning goals? Younger Generations 31% I watched or read more about the stock market than I did before 24% 18% 16% I tracked or logged into my stock or investing account more than before 20% 22% 18% 14% I had to stop watching or reading the news about the stock market 18% 21% 18% 14% I look at my stock account the same or less than I did before 17% 23% 14% 17% I paid down the debt I previously had 17% 18% 14% 14% I started looking for a higher paying job or gig work to make up for what I lost in the stock market 26% 19% 9% 3% I took on more debt than I had previously 14% 18% 9% 7% I started spending even more money than before 16% 18% 4% 3% I realized I'll need to save a lot more to reach my financial goals 34% 27% 21% Older Generations 28% Younger Millennials (25-35) Older Millennials (36-44) Gen X (45-56) Boomers (57-65) I realized I'm still on track to reach my financial goals None of these I became more cautious about my spending 36% 36% 43% 41% 13% 22% 16% 22% 14% 14% 19% 22% ©2023 Envestnet, Inc. and The Center for Generational Kinetics. All rights reserved. 10