Members of Gen Y, those born between about 1980 and 2000, are more likely to rely on personal connections for their financial advice than older generations, according to a new TIAA-CREF survey.
Adults age 18 to 34 are more likely than the general population to involve their parents (47 percent versus 19 percent), extended family (22 percent versus 14 percent) and other trusted adults (31 percent versus 21 percent) in their search for advice. Thirty-seven percent also involve a spouse or partner to help with their finances.
These findings come from TIAA-CREF's annual Gen Y Advice Matters Survey, which polled 1,000 adults nationwide to assess their attitudes, preferences and behaviors about receiving financial advice.
Gen Yers are actively planning for their financial future. Of those who sought out advice, many expressed an interest in managing a budget (72 percent versus 45 percent of the general population), saving for education (65 percent versus 37 percent) or managing their student loans (53 percent versus 25 percent).
Most Gen Yers (55 percent), also called millennials, still value face-to-face advice, but that number is declining as online advice gains acceptance, TIAA-CREF says. The number was 10 points higher in 2012. Seventy-nine percent of the Gen Yers surveyed say it would be helpful to have advice that's customized for their age group, and they are more likely to value online tools and calculators (74 percent versus 57 present of the general population), seminars (68 percent versus 53 percent) or webinars (67 percent versus 54 percent) as channels for advice.
“Gen Y gives new meaning to the term connected,” says Kathie Andrade, executive vice president and head of Individual Advisory Services at TIAA-CREF. “It's important for them to access financial advice via multiple platforms. While this may present a challenge for financial advisors, plan sponsors and employers, it also offers multiple opportunities for them to engage with Gen Y and speak their language when it comes to financial topics.”
In related findings, TIAA-CREF data shows that of the overall population, the number seeking financial advice is increasing. The number grew by 11 points to 35 percent in 2013. That still leaves 65 percent who are not seeking financial advice, notes TIAA-CREF, which is “a precarious situation considering the majority of Americans are unprepared for retirement.”