Unmotivated and irresponsible millennials? Not when it comes to finances, according to new study from RBC Wealth Management

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May 31, 2017, 11:42 ET

80% of millennials say they feel responsible for understanding their own financial affairs
69% of millennials conduct their own research to improve their financial knowledge
51% of millennials say they've turned to family for guidance upon receiving an inheritance

MINNEAPOLIS, MN, May 31, 2017 /PRNewswire/ - High net worth millennials – as defined by those under age 35 – are more confident and prepared than previous generations when it comes to talking about and planning for wealth. That's in part because of the support they receive from family, according to new global research by RBC Wealth Management conducted in collaboration with Scorpio Partnership.

High net worth millennials are proactive and curious about financial matters, the survey found. The vast majority of millennial survey respondents (80 percent) reported they feel responsible for understanding their own financial affairs, a contrast to the stereotype of millennials as disengaged and irresponsible. Additionally, 69 percent reported they conduct their own research to improve their financial knowledge, a higher rate than older generations (61 percent of respondents ages 35-55, and 47 percent of respondents over 55, reported they do the same).

Millennials also have the benefit of a head start in preparing their finances. Millennial survey respondents said the average age they started their formal education on financial issues was around 20, while Gen-Xers said they started learning around age 25, and baby boomers around age 32.

"Millennials are more educated than previous generations, with more attending college than their parents and grandparents," said Angie O'Leary, head of Wealth Planning at RBC Wealth Management-U.S. "They're a more mindful generation with a global perspective, all of which has factored into their sense of responsibility about finances."

When millennials inherit wealth, the survey results show they have an important advantage over prior generations: a support network of family that wants to help them succeed. In fact, 51 percent of millennial survey respondents said they received guidance from other family members on wealth transfer, a significantly higher proportion than other age groups surveyed.

"In general, millennials and their parents have a different relationship than baby boomers and their parents," O'Leary said. "Parents are much more involved now in their children's lives through early adulthood, and that's led to a more open dialogue between generations on the topic of wealth."

But many millennials still have a ways to go. Thirty-five percent of millennial respondents have only taken the initial step of drafting a will, and 36 percent have done nothing to prepare for wealth transfer.

"Regardless of their level of preparation, millennials are learning about finances earlier, and that's a positive trend," O'Leary said. "As long as they're thinking about the basics of financial literacy, such as budgeting, investing and saving for retirement, they'll be off to a great start."

The research – undertaken from June to August 2016 – includes responses from 479 high net worth individuals under 35 from the United States, Canada, and the United Kingdom, who have average investable assets of $5.7 million.

Other key findings from the report include:

Some millennials are looking ahead to their future beneficiaries: 38 percent of millennial respondents said they already have a wealth transfer strategy in place, and 41 percent said they plan to pass on assets gradually over their lifetimes, rather than transferring all their assets upon death.
Millennials that have already received an inheritance are thinking about what they can do to improve on the process. Fifty-three percent of millennial survey respondents said they intend to provide a greater level of support to beneficiaries than they received.

In January 2017, RBC Wealth Management released the 2017 Wealth Transfer Report, Lasting Legacy, which focused on wealth transfer trends in the U.S., Canada and the UK. In addition to the Millennials & Wealth Transfer report, RBC will release one additional research paper in June 2017, which will delve further into the challenges and opportunities families face when it comes to inheritance. The full details of the report, and a survey which allows Americans to compare their answers to the findings, is available on www.RBCWealthManagement.com.

This study focuses on linear transfers, in which wealth is passed down from the older generation of parents, grandparents or elder family members, to the younger generation. The research does not explore multi-dimensional transfers of wealth between spouses, children or siblings.

About RBC Wealth Management – U.S.
In the United States, RBC Wealth Management operates as a division of RBC Capital Markets, LLC. Founded in 1909, RBC Capital Markets, LLC. is a member of the New York Stock Exchange, the Financial Industry Regulatory Authority, the Securities Investor Protection Corporation, and other major securities exchanges. RBC Wealth Management has $289 billion in total client assets with 1,800 financial advisors operating in 200 locations in 41 states.

SOURCE RBC