Individuals who are younger than 35 are more confident than any other age group about their investment decisions, but even the young express a desire for more assistance, according to Spectrem’s monthly survey of retirement plan participants.

While 71% of the youngest plan participants believe their investment choices will provide a good return, Spectrem’s Retirement Market Insights Survey shows only 63% of 35- to 49-year-olds and 53% of those 50 or older share that optimism.

This confidence carries over into expectations regarding retirement income. Again, the youngest segment of plan participants is the most confident it will have enough income to ensure a comfortable retirement. Sadly, those closest to retirement are the least likely to share this view. Only half of those participants who are older than 50 think they will have enough income.

The optimism of the youngest plan participants may be attributable to their risk tolerance. They not only are more emboldened than older participants in their choice of investments but also have more time available to build their retirement assets. In fact, research shows tolerance for significant risk is twice as great among those who are 35 or younger (62%) as it is among those who are 35 to 49 years old (31%) and those who are 50 or older (29%).

Risk tolerance among the youngest participants is also evident in their aversion to investments with guaranteed returns. Those investments appeal most to older plan participants who are making the transition from asset accumulation to asset preservation.

While those who are younger than 35 are the most confident about their investment decisions and outlook for retirement, they also are the most likely of all age groups to seek additional advice regarding their investment choices.

Discuss this article on the forums. (0 posts)

---