Did you know that this year there are 6 million Gen Zs in Australia?
That’s a whooooooole lotta investment potential if Stockhead is right about Gen Z being the fastest-growing investor base in Australia.
Naturally, we got mighty curious about the investment mindset of Gen Zs and got to work, surveying hundreds of young Australians about their investment habits and aspirations for our latest Financial Habits survey.
And what we found might surprise you.
Three out of four Aussie Gen Zs are either currently invested in (16%) or thinking of investing in (59%) shares, which we can loosely define as a unit of equity (or percentage of ownership) in the capital stock of a corporation or company.
A quarter said they weren’t interested in investing their hard-earned dollarydoos in shares, making it the most popular form of investment among Gen Zs in Australia.
Okay, so just 3% of Gen Zs are currently investing in property.
However, two out of three (64%) of young Australians told us they were interested in investing in property in the future, making it the second most popular form of investment among Aussie Gen Zs. Perhaps the great Australian dream isn’t dead after all?
Ahhh, yes. Now, here’s a form of investment we were expecting would be favoured by the world’s first digital natives.
Roughly two fifths of Aussie Gen Zs are currently investing in (12%) or thinking of investing in (29%) in some form of cryptocurrency (also known as ‘crypto’), which is a form of decentralised digital currency.
In case you’ve been living under a rock, investing in cryptocurrency basically involves the buying and selling of the digital currency, which fluctuates on a daily basis with no real underlying value compared to shares in a company.
One of the less popular forms of investment among Gen Zs are bonds, which are essentially loans that you give to the government who are then obliged to pay back the face value of the loan and periodic interest over time. Historically, bonds have been sources of low-risk income for investors, who buy them and more or less hold them to maturity.
Just 3% of Gen Zs are currently investing in bonds, while 34% are thinking about investing in bonds in the future. However, 63% say they’re not interested at all.
- EFTs/Index funds
According to Motley Fool, EFTs/Index Funds are an “investment that tracks a market index, typically made up of stocks or bonds. Index funds typically invest in all the components that are included in the index they track, and they have fund managers whose job it is to make sure that the index fund performs the same as the index does.”
These can either be passive or active, with passive funds tracking an index like the ASX200 in Australia, meaning your money is spread across the top 200 companies in the Australian share market. The logic is if the Australian economy grows, then your money grows. You won’t get the meteoric gains of individual companies and crypto, but you also won’t have the cratering losses, as the economy usually more or less grows each year.
One in ten Aussie Gen Zs said they invest in EFTs/Index Funds while 29% are considering investing in them in the future.
According to Investopedia, “investing in precious metals comes with some benefits over investing in stocks, such as being a hedge against inflation, having intrinsic value, no credit risk, a high level of liquidity, bringing diversity to a portfolio, and ease of purchasing.”
Four per cent of Aussie Gen Zs are currently investing in precious metals, with 27% considering investing in them in the future.
You might be surprised or relieved to find out that NFTs are the most unpopular form of investment among Gen Zs.
Only 3% of Gen Zs were currently investing in non-fungible tokens, which (in case you’re still confused) are what The Verge describes as “really anything digital (such as drawings, music, your brain downloaded and turned into an AI)”. Granted, 20% of Gen Zs were considering investing in NFTs in the future, but still overall between those who are already invested in or are considering investing in these investments they came out with the least amount of interest amongst Gen Zs.