As the first wave of millennials enters middle age, the generation is growing increasingly anxious about their financial future.
Now aged 27 to 42, millennials are most worried about their cash flow (75%). They stress over how to balance covering day-to-day expenses with saving for the longer term (85%). In addition, they are more anxious about their financial future (49%). The results are revealed by RBC as per the annual RBC Financial Independence Poll.
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Gen X is aged 43 to 58 and the group makes up the largest portion of Canada’s middle-aged population. It shares similar worries about cash flow (70%) and paying for today while saving for tomorrow (82%). In addition, what the future holds for their finances troubles 54%. Both generations are also keenly focused on making the most of the money they have, to become “financially independent”.
The majority of millennials and Gen X define independence as being “debt-free” (56% and 69% respectively). Meantime, four-in-10 say it’s “having money to invest” (40% and 38%). Over the past year, less than a quarter have saved towards building an investment portfolio (23% millennials, 21% Gen X).
Importance of investing what you can, when you can
“We know day-to-day market fluctuations can cause anxiety for investors,” said Craig Bannon, director, Regional Financial Planning Support, RBC.
“But we also know how important it is to remain focused on your mid to long term goals. And invest what you can, when you can. We want to help Canadians move past any reluctance they may have and begin investing again – or get started investing – so they can grow their savings. Otherwise, it’s going to be hard for them to achieve the financial goals they’ve set for themselves.”
RBC Financial Independence Poll other findings
Millennials and Gen X highlight a number of financial goals they want their investments to help them achieve. These include:
- Retire comfortably (46% and 56% respectively)
- Build a safety net (45% and 44%)
- Build wealth (42% and 34%)
- Provide family protection/safety (34% and 23%)
They also indicated they are choosing to invest in a wide range of options, including:
- Stocks (25% Millennials, 21% Gen X)
- Pension plans (25% and 26%)
- Mutual funds (24% and 34%)
- GICs or term deposits (18% and 22%)
- ETFs (14% and 11%)
A better return on investments means a better return on life
49% of millennials and 40% of Gen Xers are willing to pay fees to gain a better investment return.
“What we’re telling our clients is that a better return on investments ultimately means a better return on life. Our proven track record of performance, after fees, can help you achieve what matters most to you,” added Bannon. “Our advisors will work with you to determine an investment strategy that matches your goals, to help you and those you care for live the way you want.”
RBC’s award winning MyAdvisor tool
Advice from RBC is readily available through MyAdvisor. The award-winning digital advice has now connected more than 4 million Canadians to their personalised plan. It features the ability to adjust those plans in real time and connect with an advisor via video chat, online or in person. Also, anyone can freely access RBC’s comprehensive My Money Matters online advice and resources hub. In addition, during February and March, key RBC investment businesses are offering incentives to help Canadians get started – or re-inspired – to invest.
