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Barrons strikes me as continuing to "dumb down". And I say this as someone who as subscribed for + 10 years, and picked it up at the newsstand regularly for decades before that... The article is a prime example.
A couple glaring problems with the article/survey:
-While the survey asked respondents about where they would invest money not be spent for 10 years, psychologically, I doubt young people will accurately "mentally account" for that span of time. More likely a sizeable chunk of them are saving for their 1st home. So they are naturally "investing" in cash (i.e. their down-payment) and plan to "invest" in real estate. OTOH, few boomer-age households are saving for their 1st home.
-Contrasting how differing age groups invest today, provides much less insight than comparing/contrasting how different age groups invest vs. their similar age groups in prior decades. In the 1970's were early boomers really investing in stocks? I don't think so. Most 20/30-something then were probably using passbook savings accounts and CDs and going to buy their 1st house.
-Stating another obvious factor: A growing % of boomers are collecting their govt annuity (Soc Security) & have less of a need for a rainy-day fund than working age folks. -- Further, presumably seniors have a lifetime of savings. So any rainy-day fund would likely be a smaller portion of their assets, on a % basis, than younger, working-age folks.
-Lastly, the real estate benchmark used to demonstrate comparative returns vs stocks SEEMS to be a price-index only. However, for those who invest directly in real-estate rentals, price appreciation is only one component of returns. Other, equally important component of returns is the cash rent received & tax-deferral of income (via depreciation).
The very predictable takeaway that Barrons wishes to leave with readers in the article is the Millenials need to own more stocks. Given the flaws noted above, its not a conclusion I would necessarily agree with.
@Edmond- I don't have any direct knowledge re Barrons but I would be surprised if you're not right re their "dumbing down". It's endemic, from The Smithsonian right on down through the Wall Street Journal. One of the few that still maintain a decent standard is The Economist.
JoJo, agree completely. Even today, as a debt-free GenX'er with a nice salary and comfortable but modest lifestyle, that once-a-week dinner delivery on the weekend still feels like a treat to me. But to do it every day? Sheesh.
Ahd the uber-expensive daily fru-fru drinks, I don't get it ... let alone waiting 15m on life for a $3 cup of drip coffee. REALLY??
It is obvious that the millennial salaries must be raised to a level that is appropriate to the world as they find it and we leave it, complete with school debt, high housing prices, foo-foo drinks and eating out.
If you have 5 or 6% college debt I am doubtful that you should invest in the stock market unless you have the possibility ofa match in your 401k.A great many experts such as John Bogle think the average return over the next 10 years will be about 6% . THis makesa riskless ^% paying off loans apretty good idea./ And, if your debt is say 3 0r 4% that seems like a close decision.I made my first stock market investment about 30 and it was years before I had as much as 20K in the markett
They need the waiting in line for foo-foo drinks and those eating out experiences to have time to stare at their smart phones. Ain't never going to give that up for no stock market.
I would say that some, maybe many, here do not really know many, much less have as children, hardworking nose-down millennials. But generalizing from media reporting is ever so much funner.
But seriously, when I go out to eat most of the people I see in both fast food and chain restaurants are retirees. The younger people sometimes are behind the counter working but increasingly even many of these are people over 40. The younger generations in my own family are highly educated with good to amazing jobs. I don't think any of them are starting out with a lot of debt. I'll be honest and say that, as a whole, I like them better and would rather be around them more than older people. I'm sure the feeling is not reciprocated.
I would say that some, maybe many, here do not really know many, much less have as children, hardworking nose-down millennials. But generalizing from media reporting is ever so much funner.
Perhaps. But as faculty at a public university I see this kind of stuff regularly. Though I agree the MSM does tend to generalise things a bit too much.
The millennials I come in contact with on a regular basis are startup farmers (for urban and semi-urban markets) and are working their asses off, and wouldn't have time for a frappuccino even if they wanted one.
Comments
A couple glaring problems with the article/survey:
-While the survey asked respondents about where they would invest money not be spent for 10 years, psychologically, I doubt young people will accurately "mentally account" for that span of time. More likely a sizeable chunk of them are saving for their 1st home. So they are naturally "investing" in cash (i.e. their down-payment) and plan to "invest" in real estate. OTOH, few boomer-age households are saving for their 1st home.
-Contrasting how differing age groups invest today, provides much less insight than comparing/contrasting how different age groups invest vs. their similar age groups in prior decades. In the 1970's were early boomers really investing in stocks? I don't think so. Most 20/30-something then were probably using passbook savings accounts and CDs and going to buy their 1st house.
-Stating another obvious factor: A growing % of boomers are collecting their govt annuity (Soc Security) & have less of a need for a rainy-day fund than working age folks. -- Further, presumably seniors have a lifetime of savings. So any rainy-day fund would likely be a smaller portion of their assets, on a % basis, than younger, working-age folks.
-Lastly, the real estate benchmark used to demonstrate comparative returns vs stocks SEEMS to be a price-index only. However, for those who invest directly in real-estate rentals, price appreciation is only one component of returns. Other, equally important component of returns is the cash rent received & tax-deferral of income (via depreciation).
The very predictable takeaway that Barrons wishes to leave with readers in the article is the Millenials need to own more stocks. Given the flaws noted above, its not a conclusion I would necessarily agree with.
I agree w/the comments above. I'll also add, maybe they don't have a ton of disposable money to invest b/c they're paying off student loans?
Ahd the uber-expensive daily fru-fru drinks, I don't get it ... let alone waiting 15m on life for a $3 cup of drip coffee. REALLY??