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Rich millennials are more cautious than their elders

According to a study, the 30,000 French millionaires under 40 years old would manage their money even more conservatively than their elders, make fewer donations but would be more interested in socially responsible investment.

By Jérôme Porier Posted today at 18h00, updated at 19h27

Time to Reading 2 min.

In 2046, millenials will represent 91% of millionaires and will hold 82% of total wealth.
In 2046, millenials will represent 91% of millionaires and will hold 82% of total wealth. Wavebreak Media / Photononstop

The arrival of new entrepreneurs from the "millennials" generation will shake up the world of millionaires, says a study commissioned by Banque Neuflize OBC at Asterès. For now, less than 5% of French millionaires, or some 30,000 people, are millennials, that is, people under 40 years of age. This population holds an estimated wealth of 40 billion euros.

Between 2016 and 2026, half of the newcomers to the club of great French fortunes will be millennials. Nearly all new millionaires between 2026 and 2036 will be born after 1980 and more than 90% of the new wealth created during this decade will be born by younger generations. In 2046, they will represent 91% of the millionaires and will hold 82% of the total assets.

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In terms of investment choices, millennials are very cautious: 43% of them consider themselves "conservative", compared to 31% for the post-war generation. This caution translates into a strong preference for liquidity and assets that can generate income.

Assets with short-term income

Among individuals with at least $ 3 million to invest, 7 out of 10 focus on assets that can generate short-term income for those with better long-term returns. The prospect of receiving regular income also pushes them to be more interested than their parents and grandparents in material assets such as real estate (90%, 72% and 67% respectively). In addition, 47% of their financial assets are held in the form of cash, compared with 30% for their parents and 16% for their grandparents.

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"Millennials have been deeply affected by the 2008 crisisexplains Nicolas Bouzou, founder of Asterès. They demand both security, profitability and meaning, three seemingly contradictory injunctions for a bank. " The only investments for which this population accepts a higher risk profile are socially responsible investments (SRI), to which they are more interested than their older counterparts.

Fewer direct donations

Among individuals with assets of at least $ 3 million, 32% invest in socially responsible businesses (compared to 15 to 24% for previous generations). Women are at the forefront of this trend: 18% of them hold "responsible" assets against 10% for men. However, the gap is narrowing, with almost as many men as women expressing interest in this asset class.

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In addition, their entrepreneurial side influences their relationship to philanthropy and volunteering. Young millionaires are thus less likely to make direct donations, but more likely to see their positive impact on the world materialized through their ways of living, consuming, working and investing.

Among individuals with a wealth of at least $ 3 million, only 36% of millennials make donations, compared with 69% and 71% respectively for the two previous generations. But 32% invest in socially responsible companies (against 15 to 24% for previous generations).

Jérôme Porier

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