A new survey has revealed one very big factor that young investors often take into account before choosing investments.
So, what is the major factor that is influencing investing choices among young investors? And what else does the survey reveal? Let’s take a look.
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What big factors do young investors take into account before investing?
According to a survey by Big Society Capital, ‘Health & Wellbeing’ is considered the biggest priority for investment for 39% of investors aged 18-24 years old and 37% of slightly older investors (aged 25-24). Meanwhile, the biggest factor for 25-34-year-olds was ‘Environmental protection’, with a massive 42% choosing this option.
‘Reducing homelessness’ was another priority area for young investors, as 30% of 18-24-year-olds and 37% of 25-34-year-olds suggest they’d invest in this area.
Perhaps surprisingly, only 16% of respondents aged 18-24 and 14% of those aged 25-34 considered ‘Youth unemployment’ an important factor. However, this could simply mean young investors believe other social issues deserve more attention.
James Westhead, Big Society Capital’s head of engagement, suggests the appetite to invest in social and environmental issues among young investors is an encouraging trend.
He explains: “The interest in social impact investing is really encouraging as it has a huge role to play in supporting charities and social enterprises that provide essential services across the country, as well as contributing to the levelling up of the economy. Now is the time to capitalise on the huge social benefits that social impact investing can bring.”
What else does the survey reveal?
‘Environmental protections’ is the biggest priority investment for older investors (aged 55+), with a massive 57% of the age group choosing this option when responding to the survey. Meanwhile, the survey also reveals that ‘Health and Wellbeing’ issues are another important priority for this group. When making investment choices, 41% of older investors feel this issue is worth taking into account.
At the other end of the scale, only 7% of older investors feel ‘Childhood obesity’ was a priority. On a similar note, only 10% of over 55s consider ‘Community resilience’ a pressing issue.
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What can we learn from the results?
It can be interesting to note that there are stark differences between perceived investing priorities for young and older investors.
Looking at these results, you might conclude that young investors are more savvy when it comes to socially responsible investing. That’s because the survey tells us that only 1% of this group said they were ‘not sure’ about which social and environmental issues should be considered a priority.
In contrast, a fairly hefty 12% of older investors suggested they didn’t have much of an opinion.
How can you invest in sectors that align with your values?
If you wish to invest in a specific sector, it’s worth researching which companies have similar values to your own.
Once you’ve identified the company (or companies) you wish to invest in, you can buy shares through a share dealing account. If you aren’t looking to buy and sell shares regularly, choosing a platform with low fees can keep costs low. Hargreaves Lansdown is a popular choice for this very reason.
Are you interested in ethical investing? If you’re particularly interested in socially responsible investing, take a look at The Motley Fool’s guide to socially responsible stocks. You may also wish to take a look at our recent article that may help you determine whether a particular investment is ethical.
For more general need-to-knows, read our investing basics guide. It can help you learn the investing ropes and avoid some common mistakes.
