Gen Yers turn to social media for financial advice

Interesting article about trends for sourcing financial advice.

Gen Yers turn to social media for financial advice
Monday, 14 March 2011 1:00pm
By Elise Burgess

Generation Yers are seeking advice much sooner than their parents, but not always from the usual sources, with around 33 per cent using social media for financial advice.

Based on a survey of 963 adults aged between 21 and 80 years, conducted by TD Ameritrade Holding Corporation late last year in the US, Gen Y is now adopting a far more collaborative approach to handling their financial matters, using multiple sources when seeking advice.

The Annual Investor Index survey found that some 60 per cent of survey respondents aged between 22 to 34 ask friends, relatives and colleagues about finances and investing.

This compares to just 43 per cent of Baby Boomers and 31 per cent of Boomers' parents that reported the same sources.

Further differentiating Gen Y, around 33 per cent or one in three respondents look to social media to get financial advice and to learn more about financial markets.

The survey also found that Gen Y are starting to take care of their finances at a far earlier age then their predecessors, learning from the Global Financial Crisis and actively engaging in their own savings.

"Many of them witnessed their parents' and grandparents' financial struggles firsthand," said Stuart Rubinstein, managing director of client engagement at TD Ameritrade.

"They're not afraid to ask for help or information —in fact, the more the better. At the end of the day, they just want to be able to make educated decisions, and that's a very healthy attitude for today's investors to have."

Bernard Salt, KPMG partner, said that it will be the Baby Boomers and Gen Y that will present the biggest shift for advisers and that these are markets advisers must cater for if they are to maintain a high quality of advice.

According to Salt, it is the shifting attitudes of Baby Boomers and Gen Y that is changing the face of financial advice.

"This will be a big opportunity for financial planners… we are not just going to see a volume shift in the next few years but also a value shift," said Salt