Millennials, the generation of people born roughly between 1980 and 2000, often get a bad rap in the workplace by older workers who see them as entitled and lacking a work ethic. The truth is that people from approximately 19 to 39 years old work as hard as anyone else does. It’s just that they have a greater need for their work to matter. When it comes to investing, they prefer that the organization they invest with serves the larger community. Far from being passive and self-serving, the right type of investment can pay dividends for both the investor and the larger society.
How Millennial Investors Are Different
According to Nicholas Tedesco, senior philanthropy advisor for the J.P. Morgan Company, we are currently amid the greatest wealth transfer in history. Millennials stand to inherit nearly $60 trillion dollars over the next four decades. They are also earning more money at younger ages, leading them to want to give back to society earlier than their parents and grandparents might have done. Millennials want to invest in a different type of way that allows them to impact large social problems with their finances. This is where the term impact investing came from in the first place.
When looking for an organization to invest in, Millennials give greater priority to those that serve a larger purpose beyond just raising money for shareholders. Because social responsibility is very important to them, Millennials might disregard organizations such as banks that have an unfortunate history of misleading or even deliberately deceiving customers.
Causes Favored by Millennial Investors Who Practice Impact Investing
The underlying theme in social impact investing is that all people should have access to fundamental rights, opportunities, and resources instead of only some people who tend to take them for granted. Some of the top social issues that matter to Millennials include:
- Access to healthy food and potable water
- Access to quality healthcare
- Affordable higher education
- Environmental sustainability
- Improved quality of K-12 education
- Social justice and civil rights
When considering investment opportunities with help from a financial advisor, Millennials are more likely to choose a company to invest in that has created a written declaration of social responsibility. They also tend to favor those with a clearly defined mission. According to Forbes Magazine, current favorites among Millennial investors include organizations with a strong environmental focus. Of course, Millennials aren’t the only ones interested in impact investing. It’s in such high demand that industry analysts predict impact investing to exceed one trillion dollars by the end of next year.
Find the Right Investments with Help from Aura Wealth Advisors
Aura Wealth Advisors offers a range of financial planning services, including investing and wealth transfer. Please contact us today to learn more about how we can help you invest in what matters to you the most.