LOS ANGELES - Two-thirds of millennials believe that they will one day be wealthy, compared to only half of Gen Xers and only a quarter of Baby Boomers, according to a survey from MagnifyMoney by Lending Tree.
MagnifyMoney by Lending Tree commissioned Qualtrics to conduct an online survey of approximately 1,000 adult Americans on their beliefs about wealth, whether or not they believe wealth is personally attainable and how they plan to build wealth.
Of the 1,000 people surveyed, 51 percent believe they’ll be wealthy one day, but only 15 percent of them say they already are wealthy.
Millennials are defined as those between the ages of 22-37, Generation Xers are those between the ages of 38-53, and Baby Boomers are those between the ages of 54-72.
Millennials were the most optimistic about their potential for future wealth — 66 percent of those surveyed said they believe they will one day be wealthy. Only 51 percent of Gen Xers believe they will end up wealthy, and Baby Boomers were the most pessimistic about their future prospects — only 25 percent of those surveyed said they believed they will one day be wealthy.
Part of this discrepancy is likely due to differing beliefs about what it means to be wealthy. The survey did not define “wealthy” as any particular level of economic achievement, but instead asked survey respondents to determine what signified wealth to them.
The majority of respondents (55 percent) reported believing that being wealthy ultimately means having the ability to live comfortably without concern for their finances, and 43 percent reported that being wealthy means feeling financially secure.
By contrast, only 18 percent of respondents said that being wealthy was defined as having a net worth of over $1 million, 16 percent said wealth was defined as having an annual household income of $500,000 and 15 percent defined wealth as having a six-figure salary.
When it comes to beliefs about the best way to build wealth, 28 percent of all adults surveyed believe that that acquiring real estate is the best strategy, followed by 19 percent who think investing in the stock market is the best strategy to build wealth. Only 4 percent believe that investing in cryptocurrency is the best strategy.
Millennials were far more likely to cite owning a business as an effective wealth-building strategy — 13 percent reported believing it was the best method, compared to only 3 percent of Baby Boomers.
While both demographic groups reported similar numbers currently investing in the stock market or real estate market to boost wealth, Baby Boomers and Millennials split significantly in regard to less traditional investment strategies. Thirty percent of millennials reported using an online savings account to build wealth, compared to only 17 percent of Baby Boomers, and 17 percent of millennials reported investing in cryptocurrency while only 5 percent of Baby Boomers reported doing so.
Of the adults surveyed, 36 percent reported saving for retirement, 29 percent reported investing in the stock market, but 23 percent reported that they are currently doing nothing to build wealth.
MagnifyMoney pointed to overwhelming debt as a likely setback for many millennials hoping to save who likely feel like they don’t have the means to invest in things like the stock market or real estate.
Regardless of any setbacks they may have to acquiring wealth, millennials showed the greatest optimism for their future, with 66 percent believing that one day they will meet their definition of wealth.
“Thinking positively about your money is key toward building better financial habits,” Andrea Woroch, a money-saving expert, told MagnifyMoney. “Ultimately, your thoughts influence your behavior which will lead to a desired outcome, so if you think you will be wealthy then you can start acting in accordance with this vision.”