Deutsche Bank: Young People To Spend Stimulus On Stocks

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A new Deutsche Bank survey finds that half of 25- to 34-year-olds plan to spend 50% of their stimulus payments on stocks, prompting the bank to say that “a large amount of the upcoming U.S. stimulus checks will probably find their way into equities,” according to CNBC.

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In addition, the survey shows that 18- to 24-year-olds involved plan to use 40% of any stimulus checks on stocks, while 35- to 54-year-olds surveyed planned to use 37% of their checks on stock market investment, according to CNBC. The over-55s surveyed said they’d put only 16% into stocks.

The survey of 430 retail investors found that respondents plan to put a large chunk (37%) of any forthcoming stimulus directly into stocks, which could represent a sizable inflow into the market of $170 billion, Deutsche Bank estimated, CNBC reports.

One of the most striking phenomena of 2020 is that retail investors became more savvy and more self-educated during the pandemic, Ally Invest panelists said last month. And one of the best lessons of 2020 is that it widened the engagement level of investing. “There was a drive to action led by events,” said Investopedia’s Dr. John Roberts, an Ally panelist at the Elevate Your Financial Future conference.

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With a slew of constant enormous events markets were very volatile in 2020, which triggered changes in investing behavior. In a “normal year,” searches are rather predictable and gravitate around items such as pensions, investing, trading tax planning, rollovers, Roberts said. But last year, searches included “buying the dip,” which was the phrase of the year, according to Investopedia’s Alexandra Kerr.

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Read Next: 4 Investing Lessons the Pandemic Has Taught Us 

This once in a lifetime investing opportunity changed the retail trading landscape, encouraging investors to take control of their finances and giving them a sense of ownership for their future and retirement. Panelists added that this trend will continue in 2021.

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About the Author

Yaël Bizouati-Kennedy is a full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She also worked as a vice president/senior content writer for major NYC-based financial companies, including New York Life and MSCI. Yaël is now freelancing and most recently, she co-authored  the book “Blockchain for Medical Research: Accelerating Trust in Healthcare,” with Dr. Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, including one in Journalism from New York University and one in Russian Studies from Université Toulouse-Jean Jaurès, France.
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