Fidelity recently released its 2024 Investor Insights Study, which gauged investors’ feelings of financial security, concerns, goals, and more across various generations. The survey, conducted between November and December 2023, included 2,100 investors from all generations.
The survey received input from baby boomers (aged 59+), Generation X (43-58), and Generation Y/Z (21-42). However, it focused primarily on the experiences and sentiments of those pre-retirement. Amidst increasing environmental stressors and investment concerns, the value of advisors appears greater than ever.
The Value of an Advisor
Advisors wear many hats for their clients, but increasingly, one of the most important hats isn’t a financial one. Fidelity found that sixty-one percent of Gen Y/Z investors seek advisors who provide services beyond financial advice and money management. Fifty-one percent of Gen X also value the ability to discuss their worries and challenges beyond finances with their advisors.
This ability to express investment anxieties and life concerns with an advisor matters more now than ever to an investor. Recent market and economic hardships left many investors lacking confidence in their ability to navigate independently. Fidelity found that over half of Gen Y/Z investors (58%) reported a greater need for an advisor this year than previously. Reasons included inflation, market drawdown, and global instability. Nearly half of Gen X (47%) reflected the same sentiment.
So, in what specific areas can advisors provide the most help to clients? Fidelity’s study concluded that the priorities, unsurprisingly, differ by age. Gen Y/Z feels most confident about their ability to pay down debt, buy a house, and save for retirement. However, they feel least confident about their ability to find early financial independence. Both generations also have high concerns regarding their ability to save for healthcare and life insurance or save enough to take a sabbatical or break from their careers.
On the other hand, Fidelity cited that Gen X feels most confident in their ability to pay down debt, buy a car, and save for college tuition and retirement. Similar to Gen Y/Z, they also feel least secure about their ability to find early financial independence. They differ in that Gen X’s top concerns include reducing their tax bill and creating the opportunity to choose a lower-paying job in pursuit of their passion.
In an environment of diminished investor confidence and heightened worries, advisors may prove invaluable in helping clients navigate fraught times. Advisors wanting to connect meaningfully with pre-retirement clients should consider the different generational needs and priorities, as well as concerns.
For more news, information, and analysis, visit the ETF Investing Channel.
Fidelity Investments® is an independent company unaffiliated with VettaFi LLC (“VettaFi”). These articles do not form any kind of legal partnership, agency affiliation, or similar relationship between VettaFi and Fidelity Investments, nor is such a relationship created or implied by the articles herein. VettaFi LLC is the author and owner of these articles.
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