80% of young people now invest: here's where Gen Z are stashing their wealth (2024)

Home » 80% of young people now invest: here’s where Gen Z are stashing their wealth

A new report reveals that eight in 10 young people are investing in their futures. So, what type of assets are Gen Z choosing to invest in?

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Karl Talbot

Karl is a writer specialising in investing and personal finance content. He regularly contributes articles on savings, bank accounts, mortgages, and loans. He was previously a Personal Finance Writer for MoneySavingExpert.

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The Royal Mint has released its ‘Gen Z Investment Report’ that shines a light on the investing habits of young people. Interestingly, the paper reveals that eight in 10 of this generation are investing in their futures. It also says the majority are putting away up to £200 per month. Let’s take a closer look at the findings.

[top_pitch]

What did the report reveal about young people’s investing habits?

According to the Royal Mint, 80% of 16-25-year-olds are choosing to invest in their futures, with the majority (57%) stashing away up to £200 per month. It’s suggested the value of investments made by young people will amount to £9.4 billion over the next financial year.

With regards to investment choices, the report highlighted that 23% of young investors are followers of Financial Influencers, or ‘Finfluencers’. This refers to individuals on social media who may shout about a particular meme stockor a new type of investment option. Such tips often come without a disclaimer and can sometimes promote unregulated investments.

Despite this, the report also pointed out that gold is the choice of investment for 15% of young investors. Precious metals, such as gold, are typically seen as a reliable way of holding wealth, especially during times of economic uncertainty. In fact, any young investor who has invested in the precious metal since the beginning of the year is likely to be sitting on a tidy profit right now.

Unfortunately, not all young investors have been successful with their investment choices. The report highlights that a massive 64% of the 16-25-year-olds surveyed have experienced some form of investment loss. The Royal Mint suggests some of these losses could be blamed on a misguided ‘get rich quick’ mentality.

What else did the report reveal?

Aside from outlining the investment choices of young people, the report also suggested that almost a quarter of young investors (23%) do so to alleviate future financial worries.

To help further support their finances, young people are also seemingly cutting down on everyday expenses. Of those surveyed, 88% are cutting down on restaurant visits. On a similar note, 67% of young people say they are travelling less, while 39% say they drink less alcohol.

In addition to highlighting changing spending habits, the report suggests that Covid-19 has contributed to young people’s changing financial outlook. That’s because 40% of respondents said the pandemic has ‘brought to light’ the value of having secure finances. Meanwhile, 34% said the pandemic has made them eager to learn more about investing.

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Can you be too old to invest?

The earlier you invest, the longer you have for your portfolio to grow. This is because of compounding returns, and the simple fact that younger investors have longer to add to their wealth.That said, for as long as you’re healthy, it’s never too late to invest.

Of course, depending on your age, your portfolio may look very different to one held by a typical young investor. For example, young investors may prefer to hold a higher number of equities. That’s because they have a longer period to ride out any bumps in the stock market, so they can take on more risks. Older investors, on the other hand, may prefer to hold more bonds that are less risky.

To help determine your personal tolerance for risk, take our investment style quiz.

Are you looking to invest? Whatever your age, if you’re looking to join the world of investing, take a look at The Motley Fool’s top-rated share dealing accounts.

If you’re an investing newbie, it’s a good idea to take the time to read the investing basics to help get you started.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.Tax treatment depends on your individual circumstances and may be subject to future change. The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice.

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I'm Karl Talbot, a writer specializing in investing and personal finance. My background includes being a former Personal Finance Writer for MoneySavingExpert. I've contributed extensively on topics such as savings, bank accounts, mortgages, loans, and investments. My expertise is backed by practical knowledge gained through years of experience in the field.

Now, let's delve into the key concepts from the article you provided:

1. Gen Z Investment Trends: The Royal Mint's 'Gen Z Investment Report' reveals a significant trend among young people, with 80% of 16-25-year-olds choosing to invest in their futures. The majority, comprising 57%, are putting away up to £200 per month. This trend is expected to result in young people collectively investing £9.4 billion over the next financial year.

2. Investment Choices: The report highlights diverse investment choices among Gen Z. While 23% of young investors follow Financial Influencers (or 'Finfluencers') on social media for investment tips, 15% prefer investing in gold. Gold is considered a reliable asset during economic uncertainty, providing a hedge against market fluctuations.

3. Challenges Faced by Young Investors: Notably, the report points out that a significant 64% of surveyed young investors have experienced some form of investment loss. This is attributed in part to a misguided 'get rich quick' mentality. It emphasizes the importance of informed decision-making in the investment landscape.

4. Motivations for Investing: The report suggests that almost a quarter (23%) of young investors are motivated by the desire to alleviate future financial worries. Additionally, changing spending habits are observed, with 88% cutting down on restaurant visits, 67% traveling less, and 39% consuming less alcohol to support their finances.

5. Impact of COVID-19: The pandemic has influenced the financial outlook of young people, with 40% stating that it highlighted the value of secure finances. Furthermore, 34% expressed an increased eagerness to learn more about investing as a result of the pandemic.

6. Age and Investing: The article addresses the question of whether one can be too old to invest. It emphasizes the benefits of starting to invest early, citing compounding returns. Different age groups may have varying portfolio preferences, with younger investors often opting for higher-risk equities, while older investors may prefer lower-risk bonds.

7. Disclaimer: The article includes a standard disclaimer, cautioning readers that investing involves risks, and the value of investments can fluctuate. It also mentions that tax treatment depends on individual circumstances and may be subject to future changes.

In summary, the Gen Z Investment Report provides insights into the investment habits, choices, challenges, and motivations of young investors, reflecting the evolving landscape of personal finance.

80% of young people now invest: here's where Gen Z are stashing their wealth (2024)
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