Here’s who’s buying the stock market crash, according to a survey

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The market volatility and record inflation we have seen this year is sending investors in different directions.

According to a recent Bankrate survey, younger investors are much more likely to take advantage of the economic turbulence and increase their investments this year than their older cohorts. More than 43% of Gen Z investors (ages 18-25) and more than 27% of millennials (ages 26-41) plan to invest more this year than last year, compared to 18% and 14%, respectively, who plan to invest less.

Meanwhile, the survey shows that only 14% of Gen X investors (ages 42-57) and 8% of baby boomers (ages 58-76) plan to supplement their investments in 2022, compared to 16% and 22%, respectively, who plan to invest less.

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Younger investors are buying the dip

The difference we see between the younger and older age groups reflected in this survey can be attributed in part to the fact that older investors are likely lowering their risk tolerance as they approach or continue their retirement years. Meanwhile, younger investors have time on their side and can actively grow their portfolio, buying stocks at a discount amid heightened volatility and inflation.

“Generation Z and millennial investors willing to invest more in stocks this year, despite market volatility and inflation, may see greater long-term rewards for the discipline to hang on and buy more at lower prices.” “, He says Greg McBride, Chief Financial Analyst and Senior Vice President of Bankrate, in the company’s press release.

These younger investors buying the dip are on to something, as long as they’re okay with keeping their money in the market for at least a couple of years. Conventional investment wisdom, and even Warren Buffett, suggests selling when everyone else is buying and buying when everyone else is selling. A good option in this market are dividend-paying stocks that provide passive income through free stock trading platforms, including TD Ameritrade, Ally Invest, E*TRADE, Vanguard, Charles Schwab, and Fidelity.

If you have $10,000 or less to invest this year, it’s worth considering almost risk-free I bonds for an annual interest rate of more than 9%, which it was at the time of this writing. Investors can purchase I Bonds through the US Treasury Department’s website — up to $10,000 each year, plus an optional additional $5,000 if they file their paper bond taxes.

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Editorial note: Any opinions, analyses, reviews, or recommendations expressed in this article are solely those of Select’s editorial staff and have not been reviewed, approved, or otherwise endorsed by any third party.

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