75% of young US investors want to diversify portfolios with crypto (BoA Survey)

Two-thirds of the American investors surveyed, between the ages of 21 and 42, believe it is impossible to achieve above-average returns based only on traditional finance. Instead, they see cryptocurrencies as the right tool for the job.

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

Diversification is the key

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

In comparison, only 32% of those over that age share the same opinion, as they prefer to allocate their funds to stocks and have deployed only 5% of their money to alternative investments such as crypto.

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

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

“As we see among our client families, financial behavior and values ​​take shape early in life and live on in the legacy passed from one generation to the next. These research findings point to a greater role for wealth advisers and the financial services industry to help families transition wealth and meet the needs of the next generation,” she added.

As it stands, most of the older generations may not advise their children to interact with cryptocurrencies as they prefer to stay away from the asset class.

But the lessons may be completely different when Generation X and Millennials lecture their children about money planning in the future.

Millennials and their love for crypto

A 2021 CNBC survey 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 found that Millennials are the demographic most fascinated by the asset class. When bitcoin was near its all-time high in November, 36% of people surveyed born between 1981 and 1996 said they would like to have some of their work pay in crypto. Generation Z was even more supportive as 50% wanted that option.

This summer, the investment company Alto evaluated that 40% of American Millennials are HODLers. The exact number of people who admitted to owning stocks, while less than that showed that they have exposure to mutual funds.