Morgan Stanley
  • Women Financial Advisor Forum

The Two "M" Words: Money and Millennials

Morgan Stanley Financial Advisor Lori Sackler looks at how the Millennial generation is becoming a driving force of impact investing in the current investment world.

I recently completed a course of study to receive a special designation at the Firm that will reflect my knowledge of family wealth management.  During an intense six months, I diligently studied the complicated world of highly affluent families and the complex personal and financial challenges they face. One issue that is of considerable concern is successfully transmitting family values to a younger generation and integrating the next generation into the wealth strategy and goals of the family.

The millennial generation, now the largest and most educated segment in the work force, according to Pew Research, is currently one of the driving forces in a growing area in the investment world, what Morgan Stanley refers to as "impact investing.” They are more focused on sustainability in their consumer behavior than the overall investor population, which is carrying over to their investment choices.   

 Women are two times more likely than male investors to desire to invest in companies that generate positive environmental and social impact, according to one Morgan Stanley study. Together, these two demographics, millennials and women, represent a large percentage of the current population seeking investments that align their personal values with their investment strategies, combining doing good with doing well financially, and they are influencing the way other members of the family invest and deliver on their philanthropic goals. Although research shows that 54% of people believe that there is a tradeoff between sustainable investing and financial returns, this belief is a myth and many millennials understand this.  

This special interest of the millennials represents a terrific opportunity for families to connect with them in the context of their philanthropy and strategic investments. Parents and senior members of the family who are eager to educate and integrate their children and grandchildren can invite them to learn more about the family portfolio of investments and philanthropy, while making a meaningful contribution in ideas and strategies in both areas. And, it provides a perfect window to engage them in the family discussions around mission and goals.

They can educate the “elders” on the different types, whether it be thematic investing, focusing on themes such as sustainable water, low carbon, clean energy, women, etc. or values based investing, seeking to restrict exposure to specific objectionable industries and companies or ESG integration, choosing investments based on the environment, social and governance criteria, it is an opportunity to engage in my favorite topic, the "the Money talk."

Think about it: you give them a seat at the table to educate and inform you on options for "impact investing" and you ultimately over time, see them taking on a bigger role in contributing to the larger family wealth plan. 

Lori R Sackler is a financial advisor, Senior Vice President and Senior Investment Management Consultant at Morgan Stanley Wealth Management and author of the M Word: The Money Talk Every Family needs to Have about Wealth and Their Financial Future (McGraw-Hill Education, undated 2016) and the M Word Journal: How To Have the Money Talk (2016).

Lori R Sackler, CFP, CIMA
Senior Vice President, Senior Investment Management Consultant
Alternative Investment Director
2017 Forbes Magazine’s Top 200 Women Wealth Advisors