The Investing Identity of Ultra-Wealthy Millennials

OppenheimerFunds and Campden Research, a division of Campden Wealth, recently published “Coming of Age,” a study that examines the investing identity of the next generation of wealthy families in North America.

The report analyzes responses from Millennials who are wealth creators or the next generation of ultra-high-net worth (UHNW) families. It focused on three main topics: investment acumen, investment behavior and relationships with advisors.

While UHNW Millennials enjoy a growing influence in managing their families’ wealth, the study found only one-fifth (21%) are fully satisfied with their families’ current objectives, and many plan to make changes in how investments are managed when they assume full control.

Most Millennials (74%) are trained and knowledgeable about their family’s portfolio and are beginning to take more measured risks with their individual investment strategies. A clear majority (71%) seeks professional advice before making investment decisions; however, the research found that the dynamic between advisors and Millennials could be improved.

“UHNW Millennials are increasingly taking calculated risks with their investments while considering the potential long-term implications of these decisions,” said Ned Dane, Head of Private Client Group at OppenheimerFunds. “Advisors can leverage actionable insights like these to encourage multi-generational family dialogues that incorporate evolving Millennial viewpoints. They can also bring value directly to Millennial clients, for example, by helping them explore alternative investment opportunities and conducting due diligence.”

Millennials are also keen to incorporate environmental, social, and governance (ESG) standards to their family portfolios. The research shows they are embracing impact investing as a means to “do good” in a way that differs from previous generations, which historically have given more directly through philanthropy.

“As Millennials edge closer to taking ownership of the family wealth, it is clear that their views differ from previous generations,” said Dominic Samuelson, CEO of Campden Wealth. “They want to make a positive change through impact investing and by implementing ESG standards to their family portfolios. They also appear to be more open to risk as they intend to access less liquid strategies. Those findings have significant implications for intergenerational wealth transfer and the wider wealth management industry.”

“Understanding the motivations of these investors is critical as we continue to look for new ways to add value for advisors serving UHNW families,” said Art Steinmetz, Chairman and CEO of OppenheimerFunds.

Ayo Mseka