Millennials also comprise more than half of U.S. online purchases, and that network more than doubled during the pandemic – climbing from 4.5 trillion in 2020 to 9 trillion in 2022.
So, why should advisors care about how millennials are spending their money?
First, it’s helpful to know what’s happening with this demographic, especially if they want to appeal to it as clients during the wealth transfer that’s about to make them the wealthiest generation.
Second, this is a growth area for advisors’ client investments. Indxx has been offering a millennial thematic index since 2016 to capture how this demographic’s spending patterns. That includes apparel, food, social entertainment, travel, mobility, education, financial services, investing, health, and fitness. A Global X ETF track the index, which now contains about $120 million and has had a 17% annualized return since 2016, including the recent market pullback.
“This generation is the largest generation and it’s growing in the U.S. It’s soon going to be the wealthiest generation, and it spends its money on very different funding categories. So, we’ve tried to target that with this index,” said Sen Sharma, noting the index includes Apple, Uber, Netflix, Meta, Airbnb, and eBay. “I think the audience for that index is anyone who is interested in gaining exposure to these different spending categories that millennials are focused on.
