Boomers would rather invest while millennials prefer cash
Nearly eight out of 10 (77 per cent) Canadians have investments, but they’re split on whether to invest their savings or to keep them as cash, according to a survey from BMO Financial Group.
While 53 per cent say they would rather invest, 47 per cent prefer to keep the cash on hand.
“It is important to understand the benefits of owning a diversified investment portfolio via different investment solutions," says Robert Armstrong, Director, Multi-Asset Solutions, BMO Global Asset Management. "There is a place for cash or short-term investments when meeting your short-term goals. However historical evidence suggests individuals who hold short-term investments, such as cash, to meet their long-term goals clearly miss out on creating longer-term wealth."
Boomers (64 per cent) and gen X (54 per cent) would rather invest, while millennials (57 per cent) are more likely to hold savings in cash, found the survey of 1,500 respondents.
A separate survey by financial services firm Edward Jones also found boomers, gen X workers, millennials and gen Z employees differ in the way they spend and save money.
But 62 per cent of those who invest say they have cash in TFSAs, representing more than 40 per cent of their account holdings, says BMO. More than one in five (22 per cent) also prefer cash assets in RRSPs, while 42 per cent prefer mutual funds.
Nearly seven in 10 (69 per cent) Canadian employees have an RRSP this year, up from 60 per cent last year, according to a separate survey by BMO.
However, Canadian workers could face a shortfall in retirement funding as nearly half either started late, or have not yet started, saving for their time after work, found another survey.
