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Millennial, Gen Z wealth hitting new heights
Growing wealth of younger investors represent long-term future for financial advisers
The Asset 29 Feb 2024

The financial assets of millennials and Generation Z grew the most of any generation over the 2019-20 period, according to data from the Federal Reserve’s 2022 Survey of Consumer Finances quoted in the Cerulli Edge – US Retail Investor Edition report for 1Q 2024. And Gen Z, the youngest generational cohort, recorded nearly US$6 trillion in financial wealth as of end-2022, up from US$2 trillion in 2019.

While all generations have seen their wealth increase, the Cerulli report notes, millennials and Gen Zers, in particular, have been aided by large increases in ownership of both stocks and retirement accounts. As well, as of the end of 2022, a majority of millennials and Gen Zers (55%) held a retirement account either through their employer or acquired independently, a six-percentage-point increase from 2019.

Additionally, the retail trading boom of the early 2020s affected this group the most, with 22% now owning individual stocks and 9% owning pooled assets including mutual funds and exchange-traded funds, up from 13% and 6%, respectively.

“At 44 million households strong – and counting – this younger cohort increasingly is becoming impossible to ignore,” says John McKenna, research analyst at Cerulli. “With their financial wealth growing at a massive rate alongside the complexity of their assets, they are prime candidates for formal advice relationships beyond just a brokerage account and a local bank teller.

“As the retiree and near-retiree markets become more saturated, younger investors represent a chance for advisers to build relationships that could last through five decades, growing in wealth each step of the way.

“And while these younger investors might not be the wealthiest cohort today, advisers willing to take the leap could be rewarded with long-term clients and a strong competitive advantage as older households fully enter the decumulation phase of their lives.”

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