- 80% of millennials say they feel responsible for understanding
their own financial affairs
- 69% of millennials conduct their own research to improve their
financial knowledge
- 51% of millennials say they've turned to family for guidance
upon receiving an inheritance
MINNEAPOLIS, MN, May 31, 2017 /PRNewswire/ - High net worth
millennials – as defined by those under age 35 – are more confident
and prepared than previous generations when it comes to talking
about and planning for wealth. That's in part because of the
support they receive from family, according to new global research
by RBC Wealth Management conducted in collaboration with Scorpio
Partnership.
High net worth millennials are proactive and curious about
financial matters, the survey found. The vast majority of
millennial survey respondents (80 percent) reported they feel
responsible for understanding their own financial affairs, a
contrast to the stereotype of millennials as disengaged and
irresponsible. Additionally, 69 percent reported they conduct their
own research to improve their financial knowledge, a higher rate
than older generations (61 percent of respondents ages 35-55, and
47 percent of respondents over 55, reported they do the same).
Millennials also have the benefit of a head start in preparing
their finances. Millennial survey respondents said the average age
they started their formal education on financial issues was around
20, while Gen-Xers said they started learning around age 25, and
baby boomers around age 32.
"Millennials are more educated than previous generations, with
more attending college than their parents and grandparents," said
Angie O'Leary, head of Wealth
Planning at RBC Wealth Management-U.S. "They're a more mindful
generation with a global perspective, all of which has factored
into their sense of responsibility about finances."
When millennials inherit wealth, the survey results show they
have an important advantage over prior generations: a support
network of family that wants to help them succeed. In fact, 51
percent of millennial survey respondents said they received
guidance from other family members on wealth transfer, a
significantly higher proportion than other age groups surveyed.
"In general, millennials and their parents have a different
relationship than baby boomers and their parents," O'Leary said.
"Parents are much more involved now in their children's lives
through early adulthood, and that's led to a more open dialogue
between generations on the topic of wealth."
But many millennials still have a ways to go. Thirty-five
percent of millennial respondents have only taken the initial step
of drafting a will, and 36 percent have done nothing to prepare for
wealth transfer.
"Regardless of their level of preparation, millennials are
learning about finances earlier, and that's a positive trend,"
O'Leary said. "As long as they're thinking about the basics of
financial literacy, such as budgeting, investing and saving for
retirement, they'll be off to a great start."
The research – undertaken from June to August 2016 – includes responses from 479 high
net worth individuals under 35 from the
United States, Canada, and
the United Kingdom, who have
average investable assets of $5.7
million.
Other key findings from the report include:
- Some millennials are looking ahead to their future
beneficiaries: 38 percent of millennial respondents said they
already have a wealth transfer strategy in place, and 41 percent
said they plan to pass on assets gradually over their lifetimes,
rather than transferring all their assets upon death.
- Millennials that have already received an inheritance are
thinking about what they can do to improve on the process.
Fifty-three percent of millennial survey respondents said they
intend to provide a greater level of support to beneficiaries than
they received.
In January 2017, RBC Wealth
Management released the 2017 Wealth Transfer Report, Lasting
Legacy, which focused on wealth transfer trends in the U.S.,
Canada and the UK. In addition to
the Millennials & Wealth Transfer report, RBC will release one
additional research paper in June
2017, which will delve further into the challenges and
opportunities families face when it comes to inheritance. The full
details of the report, and a survey which allows Americans to
compare their answers to the findings, is available on
www.RBCWealthManagement.com.
This study focuses on linear transfers, in which wealth is
passed down from the older generation of parents, grandparents or
elder family members, to the younger generation. The research does
not explore multi-dimensional transfers of wealth between spouses,
children or siblings.
About RBC Wealth Management – U.S.
In the United States, RBC Wealth Management
operates as a division of RBC Capital Markets, LLC. Founded in
1909, RBC Capital Markets, LLC. is a member of the New York Stock
Exchange, the Financial Industry Regulatory Authority, the
Securities Investor Protection Corporation, and other major
securities exchanges. RBC Wealth Management has $289 billion in total client assets with 1,800
financial advisors operating in 200 locations in 41 states.
SOURCE RBC
