Local and global markets change as trends, movements, developments, and insights shape the ways that people spend their money. Whether you're an avid investor, an entrepreneur, or like me, a student that wants to understand the global economy, here is one trend to be aware of: a huge surge of capital is about to change hands, and its going to affect everyone involved.
Over the next few decades, a massive amount of capital and assets will be transferred into the hands of millennials. The recipients of these funds are likely to spend and invest their money differently than previous generations. Why? 70% of young adults consider themselves social activists, and believe their investment decisions express their activism.
An estimated $58.7 trillion dollars will be inherited by women and millennials over the next 35 years. 75% of all disposable income is already controlled by women. The result? Incredible amounts of money will be invested into the markets by the women and young people inheriting these assets. And those assets come with a point of view.
Women’s confidence in their abilities to manage money is trending upward. 70% of women fire their financial advisers within one year of taking control of their finances, usually upon the death of a spouse. One significant change anticipated is that as women gain control, they will prefer to invest and spend their money with companies that create social benefit.
Social impact investing is on the rise, as is social awareness. From 2010 to 2011, the number of young adults that self identified as social activists nearly doubled. From 2012-2014 sustainable investing grew almost 150%. Half of millennials are currently willing to take a pay cut in order for their employer to make positive environmental and/or social impact. 91% of modern global consumers are likely to switch to brands that support good causes.
The numbers are there; millennials and women are taking over the global investing market, and their money is headed toward social impact. As an investor, it's vital to understand that when funds of this magnitude enter the market, anyone following suit is sure to reap the benefits. Companies must focus on establishing patterns of social change through their products and services if they hope to remain popular among consumers. Investors would be well advised to get involved with impact investing. The world, and its clients, are ready.