Menu
Banking Exchange Magazine Logo
Menu

Millennial Investors Prioritize Advisory Firms’ ESG Commitments

JD Power survey reveals boomers and millennials have “stark” differences when it comes to investment preferences

  • |
  • Written by  Banking Exchange staff
  • |
  • Comments:   DISQUS_COMMENTS
Millennial Investors Prioritize Advisory Firms’ ESG Commitments

Environmental, social and governance (ESG) issues have become a “major priority” for millennials compared with their baby boomer counterparts, new research has shown.

However, younger investors have doubts about their advisory firms’ commitment to responsible investing, according to the JD Power 2021 US Full-Service Investor Satisfaction Study.

In the past year a “stark divergence” in investment behaviors and preferences has opened up between the millennial generation and boomers, the survey showed.

The study found that among investors under the age of 40 – known as millennials – who strongly agree that their advisory firm is committed to ESG efforts, 52% plan to increase their investment with that firm, with that number falling to just 24% among investors over 40 years old.

But 68% of millennials surveyed said they either had doubts about their firm’s commitment to ESG or don’t know about it.

Mike Foy, senior director of wealth intelligence at JD Power, said: “Investors under age 40 are changing much more quickly in terms of their wealth management preferences and priorities – and they look increasingly different from boomers.

“Not only has the pandemic significantly accelerated their shift to more digital engagement, but emerging issues like ESG are also a major priority for them that isn’t seen as much yet among boomers.”

The millennial generation is set to inherit more than $68 trillion in wealth from their parents during the next decade, JD Power’s report stated.

Foy added: “Wealth management providers are making a mistake if they assume that the emerging affluent investors will simply evolve into boomers over time.”

The research revealed investors under 40 have a preference for one-time fee-for-service and subscription payment models

Among the millennials surveyed, 74% would prefer to pay for full-service wealth management via a one-time fee-for-service model, while 73% supported a subscription model. 

By contrast, among full-service investors aged 40 and older, 42% backed a fee-for-service model and 34% a subscription model.

back to top

Sections

About Us

Connect With Us

Resources

Webinar: From KYC to IDV

How three leading banks are utilizing cutting-edge
digital tools to onboard, win, and wow customers

Time/Date: June 23, 2021 11:00 a.m. ET

Digital adoption, already moving at warp speed, accelerated seven years into the future during the COVID-19 pandemic. As the number of bank branches continues to fall, with at least one study predicting all branches will disappear by 2034 (Fox Business) and foot traffic declining (Vox), today’s most innovative banks are charting a new, digital-first path to win over customers while increasing security, meeting KYC compliance requirements, and winning customers to drive revenue.

In this webinar, you’ll hear from John Baird, Founder & CEO of Vouched, Tyler Crawford, COO of Bankers Healthcare Group, Anand Sathiyamurthy, CPO of Flagstar Bank and Daniel Sheehan, Chairman & CEO of Professional Bank as they describe their vision for digital transformation and how customer expectations are changing to digital first. They’ll also explore how fostering an innovation mindset creates new ways to tackle complex KYC problems and allows them to quickly compete in new markets and win customers.

REGISTER NOW!

This webinar is brought to you by:
Vouched Logo