Younger generations are embracing investing

HSBC’s new Affluent Investor Snapshot 2024 reveals that younger generations start their investment journey up to 10 years earlier than Gen X and Baby Boomers. They also dedicate a higher proportion of their income (27 per cent) towards investing versus Baby Boomers (22 per cent), with Millennials planning to put 56 per cent of their cash to work. Top financial goals for Millennials include gaining wealth for financial security (42 per cent), education savings for children (40 per cent) and retirement planning (39 per cent).

Jeffrey Yap, Head of Investments and Wealth Solutions, Southeast Asia, HSBC Global Private Banking and Wealth, said, “It’s clear from this data that Millennials are embracing investing earlier than older generations. This puts time in the market and the power of compounding on their side which are critical in building a strong foundation for financial security and well-being. As they go through their investment journey and put their cash to work, they will look for actionable views and solutions that directly address their needs. This is where our expertise can make a significant difference.”

Furthermore, the survey underlines a growing awareness and intent to own alternative investments as part of a well-diversified portfolio among Millennials. In particular, the younger generation exhibits a strong interest in adding private market funds and hedge funds to their portfolios over the next three years.

“The fact that young investors are looking more closely at alternative assets serves as another tailwind for the asset class, as product and platform innovations improve accessibility for a wider range of investors, especially to private markets,” Yap continued.

Additional Key Findings

• Public equities, fixed income outside cash are the most popular asset classes. Affluent investors currently allocate an average of 32% of their portfolios to cash and cash equivalents, followed by public equities (15 per cent) and fixed income (14 per cent). In terms of themes, affluent investors are interested in AI & automation and renewables and clean energy.
• Portfolio diversification top of mind: Affluent investors are planning to diversify their portfolios further across asset classes, investment instruments, and geographies, with individuals in Asia spearheading this trend over the next three years. Looking to the future, derivatives, annuities, ETFs, REITs, and bonds are investment products of interest for affluent investors.
• Despite affluent investors across the world demonstrating ‘home bias’ in their investments – as reflected in their equity exposure – over one-third say they intend to increase their investments in international markets, with the United States and mainland China ranking as the top two destinations. But almost half of all investors say ongoing uncertainty around market conditions and the complexity of maintaining a portfolio present hurdles to diversifying further.

HSBC propositions to cater to Millennials’ financial needs
HSBC has enhanced its suite of wealth products, solutions and advisory services to offer holistic and comprehensive offerings that cater to Millennial customers’ needs across various life stages:

Digital Wealth Platform and Tools

• Financial calculators: Online tools such as the Retirement calculator and the HSBC Grow My Wealth Calculator can help assess finances and provide insights that will help Millennial customers on their wealth and investing journey.
• HSBC Wealth Dashboard: our HSBC Wealth Dashboard function, which is integrated into the HSBC Online Banking website and HSBC Singapore app, can help Millennial customers start and manage their investment journey no matter where they are.

Insights-led Wealth Expertise

• Wealth Insights: All HSBC customers can access HSBC’s Wealth Insights Hub, a platform with exclusive insights curated to meet their investment and wealth needs, ranging from our house view, FX trends, global and regional market outlook to sustainability insights, thought leadership articles and financial education. The HSBC ‘Let’s Talk Wealth’ content series, available on HSBC Singapore’s YouTube channel, allows customers to build up their financial knowledge through practical tips from experts.
• Personalised Wealth Advisory: Backed by a global team of investment, insurance and foreign exchange specialists, our Premier relationship managers offer personalised insights and guidance to help clients achieve their financial goals.

The Affluent Investor Snapshot 2024 is a Global Quality of Life special report by HSBC. Its insights are based on data gathered from 11,230 individual investors across 11 markets. Click here to read the full report.

Media enquiries

Carina Koh carina.koh@hsbc.com.sg