Why Millennial Women Are Tuning Into Their Finances by Ann Hynek, BlackRock
While survey data finds millennials more engaged than other generations when it comes to finances, there are some differences between how millennial men and women invest. The BlackRock Blog’s Global Editor takes a deeper dive into the numbers.
I don’t know about you, but I frequently find parts of my job overlapping into my personal life. No, this isn’t a post about work-life balance. It’s about money and long-term planning topics popping up in casual conversation with friends. It’s not the only thing we talk about, of course. It finds its way in between the latest news headlines, the best new fitness app, planned vacations, the hip-but-comfortable spring shoe that is also work appropriate, etc. While I think this phenomenon is attributable to the fact that the company I keep frequently consists of others who work in finance, a recent survey also strongly supports that millennials tend to be very in tune with money and investing.
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Millennials more engaged when it comes to finances
BlackRock’s Global Investor Pulse research found that millennials as a whole are one of the most engaged group of investors. This makes sense to me, as we’re the generation who came of age during the financial crisis, watching our parents deal with dwindling retirement accounts and graduating when jobs were scarce. Many of us are also entering the working world in the red: Outstanding student loan debt in the United States is more than $1.2 trillion. Staying on top of our finances isn’t a take-it-or-leave-it habit. It’s a necessity.
Millennial women versus others surveyed
A closer look at sentiment among millennial women revealed some key differences when compared to millennial men and women of other generations. Among them:
It’s a fact of life that women tend to be more risk averse than men. This phenomenon rings true among millennials as well. While millennial women prioritize growing wealth almost as much as millennial men (37 percent and 39 percent, respectively), only 33 percent of millennial women say they’re willing to take on higher risk for higher returns (versus 61 percent of millennial men). However, millennial women are less risk averse than baby boomer women, 21 percent of whom say they’re willing to accept risk for a higher potential reward. If you’re sitting in cash, we have some suggestions for how to shift from saving to investing.
The survey found young boys were more likely to learn about financial markets than girls. When asked whether they feel knowledgeable about investing, 57 percent of millennial men responded yes—versus 30 percent of millennial women (and 25 percent of female boomers). We also found that millennial women who learned financial responsibility from their parents were more likely to engage in and enjoy investing. If you’re looking for ways to learn more about how to invest, you’ll find some great educational posts on the BlackRock Blog. Even simply knowing what’s going on in the markets—and getting an expert’s take—is a step in the right direction.
Delayed retirement savings
53 percent of millennial women say they’ve started saving for retirement versus 71 percent of millennial men. This may be attributable to the fact that millennial women prioritize paying off debt: 57 percent versus 40 percent of millennial men. My colleague Heather Pelant stresses the importance of saving for retirement, no matter the size of your contribution and shares ways to maximize your investing goals this year.
Want to know what else we discovered? Learn more about women and investing trends via our Global Investor Pulse Survey.