75% of Young US Investors Want to Diversify Portfolios With Crypto (BoA Survey)

Two-thirds of the polled American investors, aged between 21 and 42, believe it is impossible to achieve above-average returns relying only on traditional finance. Instead, they see cryptocurrencies as appropriate tools for the job.

Numerous previous researches have shown that younger generations are much more inclined toward the digital asset sector than older individuals. At the peak of the bull run in 2021, many youngsters said they would be happy to receive part of their salaries in crypto instead of fiat.

Diversification is the Key

In its surveys, Bank of America estimated that 75% of US investors aged up to 42 think alternative financial instruments such as cryptocurrencies, real estate, private equity, and commodities should take a certain part in their portfolios. In their view, having exposure only to traditional stocks and bonds can not guarantee future profits.

In comparison, only 32% of those above that age share the same opinion as they prefer to allocate their funds to equities and have distributed only 5% of their money to alternative investments like crypto.

The analysis further disclosed that 68% of the polled parents have already had an educational discussion with their kids on how to transfer the family wealth to them. Baby Boomers are expected to shift $84 trillion to Generation X and Millennials by 2045.

Katy Knox – President of the Private Bank of Bank of America – claimed, “wealth planning is inherently multi-generational.”

“As we see among our client families, financial behaviors and values take shape early in life and live on in the legacies passed from one generation to the next. These research findings point to a larger role wealth advisors and the financial services industry is playing in helping families transition wealth and meet the needs of the next generation,” she added.

By the looks of it, most people from the older generations might not advise their children to interact with cryptocurrencies since they prefer to stay away from the asset class.

However, the lessons could be completely different when Generation X and Millennials lecture their kids about money planning in the future.

Millennials and Their Love for Crypto

A CNBC research from 2021 estimated that 47% of Millennial millionaires had invested at least a quarter of their funds in digital currencies. On the other hand, 83% of the older investors were not fond of crypto and have not invested in it.

Another survey revealed that Millennials are the demographic group most intrigued by the asset class. When bitcoin was close to its all-time high price in November, 36% of the polled people born between 1981 and 1996 said they would like to get some of their work payments in crypto. Generation Z was even more supportive since 50% wished for that option.

This summer, the investing firm Alto evaluated that 40% of American Millennials are HODLers. The exact amount of people admitted owning stocks, while less than that revealed they have exposure to mutual funds.