The latest generation to enter the workforce, millennials — Americans born in the 1980s and 1990s — are the future of financial planning. Today, this group numbers nearly 70 million and by 2020, they will make up almost 50 percent of workers and investors. As investors and retirement savers, this group poses an interesting challenge as a result of spending high school, college and early working years during the financial crisis. Many millennials are wary of the stock market, and their overly conservative approach may be causing them to miss important opportunities to build savings for retirement.
Recent studies reveal that many millennials are generally investing as conservatively as retirees. In one study of investment preferences, those age 22 to 32 said that they chose to put 75 percent of their retirement savings in cash and bonds and only 25 percent in equities. In a second study conducted by the Investment Company Institute (ICI), 74 percent of those under the age of 35 stated that they were unwilling to take above-average or substantial risk with their investments — another indication of this group's tendency to be risk-averse and potentially overlook equities.