How Different Generations InvesT
Generational divides aren’t just fodder for Thanksgiving debates—they shape the way Americans build wealth, manage risk, and (sometimes unwittingly) pass up opportunities to learn from one another. As Kiplinger’s latest feature highlights, the way Baby Boomers, Gen Xers, Millennials, and Gen Z approach investing runs deeper than simple risk tolerance or asset allocation models. Each group brings its own instincts, blind spots, and biases—sometimes to their own benefit, sometimes not.
The classic wisdom holds that younger investors take more risk, older investors play it safer—and the data largely back it up. According to a Betterment survey cited in the article, over 60% of Gen Z are willing to take on increased risk, compared to only 10% of Baby Boomers. But where that risk shows up has changed: young investors chase short-term gains in single stocks and alternatives like cryptocurrency, while older generations stick to familiar territory. As I shared with Kiplinger, “Older generations often stick with investments they know, while younger investors are far more willing to experiment.”
Yet this “agility” comes with its own risks. The article details how Gen Z flocks to crypto despite knowing it’s risky, sometimes skipping the due diligence or skipping out on professional advice. Boomers, by contrast, risk falling prey to “status quo bias,” holding on to the tried-and-true even when the world around them is shifting. I see this at play every day: “Older clients usually excel at discipline, steady saving, thoughtful goal-setting and resisting the noise during a downturn. But they sometimes get stuck in their comfort zone, missing emerging opportunities by clinging to familiar strategies.” Conversely, I noted that “younger clients are incredibly agile and curious, willing to rethink traditional approaches and jump quickly into new asset classes. But they often underestimate the power of patience and the risks of over-concentration or hype.”
Where we get our financial information only amplifies this divide: younger investors rely on TikTok and social channels, sometimes overconfident in “crowdsourced” wisdom, while their parents stick with TV or, more commonly, friends and family. The article notes that 72% of respondents rank financial advisors as their most trusted resource, but less than a third actually work with one—a gap worth bridging, regardless of age.
The real opportunities, I told Kiplinger, come from breaking out of generational silos and listening to someone who sees the financial world a little differently. The best results? “When generations learn from each other. Every investor, no matter their decade, could benefit from listening to someone who sees the world a little differently.”
The bottom line: The strongest portfolios, and the wisest investors, pull the best from each era of experience—mixing discipline, patience, adaptability, and open-mindedness. In the words of Henry Ford, “Anyone who stops learning is old, whether at twenty or eighty.”