NEW YORK (MainStreet) Millennials are more likely to use Websites and social media in guiding them as they make financial and retirement decisions compared to Generation X.
Millennials (or Gen Y-ers) are more likely to use websites (58%) than Gen X (48%), according to a recent Nationwide Financial survey. Gen Y-ers (born 1978 to 1988) respondents are almost twice as likely to use social media at 25% compared to Gen X (born 1965 to 1977) at 13% as resources for financial planning.
Millennials are almost three times as likely to use books as a planning resource than Gen X (27% vs. 10%).
The survey was conducted to understand the current sentiment among consumers about financial planning, said Michael Spangler, president of Nationwide Funds Group. Many investors are getting their financial advice from books, friends, family, the Web, social media and TV instead of using a financial advisor.
Millennials seem to have "an inherent distrust of market investments, perhaps rightfully so given the recession of 2008," he said.
"In fact, the survey found that Generation Y was more afraid of investing in the market (74%) than they were of dying (71%)," Spangler added. "This means they are more likely to rely on their own sources for developing any sort of financial plan."
Millennials turn to Websites (58%) more than they do financial advisors (51%) for their financial planning needs.
"While research and ownership of your financial plan is good, those who want to go-it-alone could be overlooking some very important considerations like volatility, diversity and risk tolerance," he said.
Relying on social media sources is a double-edged sword, Spangler said.
"On the one hand, it is encouraging that younger investors are using online tools to become more educated investors," he said. "On the other hand, you can't write your financial plan based on information shared in 140 characters or sound bites. No online tool can replace the knowledge, experience and personal touch you get from a financial advisor."