As the US economy recovers from the 2008 recession, consumers are becoming more optimistic, driven by younger Americans’ increasing confidence in the economic outlook. New research from Mintel reveals that three in five (59 percent) consumers believe the economy is strengthening, including 75 percent of Millennials. What’s more, an overwhelming number of Millennials plan to increase the amount they invest by the end of 2016 (68 percent) compared to two in five (42 percent) consumers overall. When it comes to achieving real wealth, the majority of Millennials believe that investing is the only way to do so (73 percent vs 63 percent of consumers overall). Robo-advisers, online investment services that rely strictly on algorithms to manage consumers’ financial plans, are poised to benefit from Millennial investment trends as Millennials are more than twice as likely to use robo-advisers for their non-retirement (17 percent) and retirement (16 percent) investment accounts than consumers overall (7 percent respectively). Furthermore, seven in 10 (69 percent) Millennials agree traditional investment advisers are for people who have a lot of money, opening the door for non-traditional investment products and services. This coincides with Mintel Comperemedia’s 2016 Financial Services Trend “Power to the People,” which highlights the fact that technology is making it easier and more straightforward to invest, driving interest among investors of all ages and income levels. 74% of Millennials are comfortable with their level of knowledge of investing While the majority are increasing their investments, Millennials’ confidence in their abilities is nearly matched by unease when making investment decisions. Millennials are more comfortable with their level of knowledge of investing than any other demographic (74 percent of Millennials vs 52 percent of Gen X), yet they are also the most likely demographic (62 percent) to agree that the idea of investing makes them uncomfortable (vs 23 percent of Baby Boomers). “The majority of Americans agree that the nation’s economy is strengthening, none more so than Millennials, who are considering increasing the amount they invest this year. The low minimum requirements of a robo-adviser account is a huge draw for Millennial investors who believe financial advisers are for people with bigger account balances,” said Robyn Kaiserman, Senior Financial Services Analyst at Mintel. “Combined with the fact that Millennials have many years of investing ahead of them, robo-advisers will likely become even more popular as time goes on. Products and services that incorporate the insight of traditional financial advisers with the straightforward and anytime, anywhere convenience of new investment technology will have the best chance of securing long-term consumers, especially among younger investors.” While Millennials believe that investment advisers are for the wealthy, they do value their importance and especially prefer those at banking institutions. Mintel research indicates that 39 percent of Millennials would like to receive financial advice from an adviser at their bank, more so than any other type of adviser (eg an accountant, adviser at an investment company). However, a similar number of Millennials (37 percent) prefer to go it alone and make all their investment decisions themselves. “The majority of Millennials prefer to have non-retirement accounts at a bank, indicating that efforts banks make to highlight their advising services could be highly successful. We find that Millennials are also in favor of receiving financial advice from an adviser at their bank, leading to cross-selling opportunities and increased promotion of human advisers who can hold consumers’ hands through the investment process,” continued Kaiserman. Overall, 42 percent of US adults do not currently own any kind of investment account. When examining the reason behind this, nearly half of consumers (47 percent) cite a lack of money to invest. Aside from a lack of investment capital, consumers do not have an account because they do not know enough about investing (18 percent), are not interested in investing (17 percent) or do not want to risk losing money (17 percent). Consumers with an annual household income of at least $100,000 and no investment account say not having enough money is their primary reason for not investing (22 percent). What’s more, these consumers are equally likely as consumers overall to not want to risk losing money (17 percent), despite two thirds (67 percent) who agree that investing is the only way to achieve real wealth. “Overwhelmingly, consumers see a lack of money as the main reason for not investing, followed by the fear of losing their money and a lack of investing know-how. Our research shows that while consumers with lower household incomes will likely be interested in the opportunity to invest with robo-advisers, those with higher incomes might require the assistance of a human adviser who is better equipped to provide investment education and strategic planning to alleviate their concerns,” concluded Kaiserman. Press copies of the Investment Trends US 2016 report and interviews with Robyn Kaiserman, Senior Financial Services Analyst, are available on request from the press office. You might also be interested in: Socially responsible investing is coming to robo-advice Thought Bubble: Will Joon take flight with Millennials?