A recent Bankrate study shows that the majority of young Americans feel cash is the safest bet when it comes to long-term investments.
This is not good news, considering this age group has the largest savings burden when it comes to building a healthy retirement nest egg. They will have a much tougher time if they rely primarily on low-yielding cash investments.
â€śThe preference for cash and aversion to the stock market among young adults is very troubling considering this age group has the biggest retirement savings burden. They wonâ€™t get there without being willing to assume a little short-term price risk in their long-term money,â€ť says Bankrate.comâ€™s chief financial analyst, Greg McBride, CFA.
Some of the survey results:
â€˘ 39% of respondents age 18 to 29 say cash is their preferred way to invest money they donâ€™t need for at least 10 years. This is triple the number who picked the stock market.
â€˘ Generally, Americans chose cash as their preferred long-term investment. Approximately one in four Americans prefer cash investments for money they will not need for at least 10 years.
â€˘ Cash scored slightly higher than real estate (23%) for the No. 1 spot, while stocks came in third (19%).