Millenials prefer cash to stocks for investments
39% of younger adults say cash is king
SAN ANTONIO – When it comes to investing their money, a lot of millenials are playing it safe and sticking to cash savings.
That's one finding of a BankRate.com survey that asked the question: "Where would you invest money you won't need for at least 10 years?"
A whopping 39 percent of the youngest adults under the age of 30, said they would keep the cash in a savings account or CD.
Only 13 percent said they would invest in the stock market, and 24 percent said real estate was their investment of choice.
"I would put it in a savings account," said Suzanna Guzman, a San Antonio college student. "I'm just kind of a safer person. The stock market is too risky for me. I don't know enough about it."
Can you blame them for being hesitant?
"I think it's natural after a big storm to be worried about the next storm," said Kent Copeland, financial adviser with Ameriprise.
Many young adults had an up-close and personal view of the market crash six years ago, the housing bust and the problems their parents encountered.
Millenials' fear is understandable and even healthy, according to Copeland.
"It can be very healthy," he said. "It encourages them to save."
While Copeland recommends a cash emergency fund of at least three months expenses, the long-term calls for a different investment strategy.
Over a 20-year time frame, stock market investments have a much greater yield than cash investments, he said.
"If you want food in the next matter of months, you'd plant a tomato plant; but if you want food over the next 20 years, you might want to do a fruit tree."
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