While some members of the TikTok generation may rely on social media for investment advice, they may also be the most engaged generation when it comes to tracking financial goals.
According to a BMO survey conducted last fall and released on Wednesday, 62% of gen-Z respondents (age 18–25) and 54% of millennials (age 26–41) reviewed their goals at least quarterly.
That compared to just over one-third (36%) of boomers (age 58–67). (No data were available for gen X.)
For some younger Canadians, one goal was achieving financial freedom. One-quarter of gen-Z (26%) and one-fifth of millennial (20%) respondents had contributed to their TFSAs in hopes of achieving financial independence as early as possible, the survey said.
In line with that finding, younger respondents were more likely to invest than put their money in savings accounts, compared with older respondents. However, those who primarily held cash said they did so because they didn’t know how to invest (49% of gen Z and 39% of millennials).
Therein lies the potential for trouble. One-third of gen-Z respondents (33%) and just over one-fifth of millennials (22%) admitted they referred to financial influencers and social media for their investment decisions.
Still, younger Canadians were no strangers to the financial industry, with nearly half of both gen-Z respondents and millennials (44% and 51%, respectively) relying on professional advice for their financial decisions.
Along with teaching younger clients about investments, advisors can help them plan.
The survey found that 18% of gen-Z and 10% of millennial respondents sought professional advice for the first time during the pandemic — likely because of life changes in some cases. Roughly one in 10 younger respondents had changed their financial goals and plans during the pandemic, such as starting a family, purchasing a home or starting a new business.
Previous research has suggested the pandemic was particularly hard on members of gen Z, who are disproportionally represented in service sector jobs. Those who took on more debt or saw their financial situations destabilize were strategizing with saving and budgeting, a 2021 survey from the Canadian Bankers Association found.
Pollara Strategic Insights conducted the online survey of 1,500 adult Canadians for BMO between Oct. 26 and 29, 2021. The polling industry’s professional body, the Canadian Research Insights Council, says online surveys can’t be assigned a margin of error because they don’t randomly sample the population.