Other financial advisors see similar trust challenges. "There's a much deeper level of skepticism, for some good reasons," says Michael Kitces, director of research at the Pinnacle Advisory Group in Columbia, Md. With Gen X and Y, he adds, investment advice "starts to become an issue of credibility."

The reason for the credibility gap isn't hard to understand. Given the huge drop in equities spawned by the banking, housing and liquidity crises, says Kitces, the financial community has essentially "given advice that hasn't worked in a decade. A lot of folks have been out of school and in the work force for a decade or more," he points out, and for them, "there's still no appreciation in equities." Their investing experience thus far, he added, is in stark contrast to that of the baby boom generation, whose attitudes about investing were forged by "a tremendous bull market."

Under the current conditions, Kitces notes, it may take a long-term, sustained rise in equities to pull younger investors back into the market with any degree of enthusiasm. "If we continue to have this kind of up and down market, it's going to be hard to win their trust. You can get a generation back" into the investment arena, adds Kitces, "but I think we're at a pretty delicate point right now."

Watching what happened to the 401(k) plans of their parents-the original "Don't trust anyone over 30" cohort-has only exacerbated the trust issue for Gen Y. But most of their parents stayed the course with their 401(k) allocations and kept contributing, so this dynamic could play out positively. "Account balances are back near their 2007 high," says Hobson.

There is another factor at play with both Gen X and Y. "Investing for a huge chunk of Gen X and Y is not a vocation or even a hobby," Fidelity's Gresham says. "Many investors will look for better education and decide how much they want to do on their own."

The impact, of course, is hardly limited to younger investors. A recent survey of more than 1,000 wealthy U.S. investors by Cisco Internet Business Solutions Group [IBSG] found widespread concern among all age segments about their financial future, and increasing skepticism about "the efficiency of the financial markets." Half of those respondents also "expect that they will be forced to delay their retirement due to the poor?performance of their investments," Cisco found.

Additional research paints a similar picture. The fifth Heartland Monitor Poll from The Allstate Corp. and the National Journal, released last year, found a deep-seated anxiety-and a craving for stability-among the "millennial" generation of Americans aged 18-29.

"While most Millennials have been able to make ends meet, they are having a hard time managing debt and saving for the future," says Allstate Chairman, President and CEO Thomas Wilson.

According to the Heartland survey, only 16% of 18- to 29-year-olds say they can live comfortably and save an adequate amount on their current incomes, and 32% say they "find it hard to make ends meet every month." And fully 46% of them say paying for a four-year college degree is an economic burden. More than half of respondents, 55%, say their goal is long-term employment with a single employer, not unlike their grandparents who grew up in the Great Depression.

Compared to their grandparents, the so-called organization men who participated in the post-World War II economic boom, younger Americans have learned it's a dodgy proposition to count on a large corporation for safety and security.