The millennial wealth gap
I was in a meeting this week when the subject of ‘millennials’ came up. And, shortly into the...
Excuse me while I have a millennial moment, and share my excitement about getting the latest iPhone.
Now, before you start to judge me on throwing money away on the newest and hottest tech, believe me when I say it was time. Unlike my old iPhone 5, not only does my new phone have a working camera and will record audio once again, but the battery life lasts longer than 40 minutes – it’s revolutionary let me tell you.
Despite all the problems and hassles with my old phone, I didn’t actually want to get a new one because my old one – while temperamental at the best times – did still work. At least for the basics like calling, texting and the occasional tweet or email.
Where it would let me down was my apps – apps I missed dearly, as they were just as ingrained in my routine as getting up in the morning.
From an alarm clock to checking the news headlines and whether my bus or tube was running on time, through to my Starbucks order ‘to-go’… I’d use a handful before even leaving the house for my morning commute.
So how exactly do you make investments from a generation married to their phones? I take a look at some of the funds investing in my essential apps.
“Technology has forever changed the world we live in. We’re online, in one way or another, all day long. Our phones and computers have become reflections of our personalities, our interests, and our identities. They hold much that is important to us.” – James Comey, 7th Director of the FBI
Of course there’s the obvious. Let’s start with the phone itself. While I’m partial to Apple (a top ten holding in BMO Responsible Global Equity*), for the easy synchronisation with my Apple Watch and MacBook, other people are just as loyal to the likes of Samsung, a holding in T. Rowe Price Global Focused Growth Equity*.
Is it any surprise I immediately looked to Facebook once I got my phone set up? A study by Statista found that, of those who use Facebook (a holding in AXA Framlington American Growth*), 74% log in daily, and most check Facebook several times a day.
I’m guilty of doing that myself. Between their push for Libra (a blockchain digital currency) and what we know of the way the company has shared our data, I’m not entirely convinced Facebook isn’t taking over the internet (they probably knew I was writing this before I did). But despite that, it’s still a necessary, sometimes evil, part of most millennials’ life. In fact, the same study found that 32%** of Facebook users were aged 25-34 – and perhaps surprisingly, the biggest demographic group is, at 19%,** millennial men aged 25–34.
The thing I was most excited about? The new high quality camera. I missed being able to take photos without having to borrow someone else’s phone. After the likes of Instagram, I immediately downloaded my Adobe creative cloud to edit photos quickly on the go. Adobe, a holding in both Rathbone Global Sustainability* and Rathbone Global Opportunities*, is commonly known for its Adobe Acrobat and pdfs, but it does SO much more. From Lightroom, Photoshop, even Premiere Clip, Adobe is a must-have for any millennial looking to stay on top of their social media game.
Rathbone Global Opportunities is no stranger to apps either. In our first ever episode of the ‘Investing on the Go’ podcast, manager James Thomson told us about his holding in Match Group* which owns Tinder. Although not one of my essentials, it certainty is for many others…
Something most of us can probably agree on: good music is essential for an enjoyable commute. But I can’t remember the last time I bought a physical CD. Instead I opt for streaming, and my service of choice is Spotify. My favourite thing at the moment (apart from FundCalibre’s investing on the go podcast, of course) is the daily playlists made just for me – it’s a good way to mix things up in the morning. Spotify is just one of the many disruptor companies held in Scottish Mortgage Investment Trust.
Although not completely necessary, I would be lost without my Starbucks app. Remember when I shared how I cut back on my Starbucks to save more? Well I did it with the app. Each month I put a prepaid amount in the app and once it is gone, it is gone. I don’t reach for my debit card or click Apple Pay, I skip it. Our recent plastic-free July video showed how Aberdeen Standard Investments is actively engaging with Starbucks to reduce its waste.
Amazon, a top ten holding in LF Miton US Opportunities*, takes up not one, but five, spaces on my phone now. From Prime and Prime Now, to my Kindle app, I can say with confidence Amazon is slowly filling my phone with shopping potential.
With all this shopping comes some responsibility as well. My NatWest app, (a bank owned by RBS, which is a holding in Schroder Recovery*) is prominent on my home screen. not only can I do all my banking from my phone, I can also stay alert to fraud. But Natwest isn’t the only one that’s got my back. American Express, a top ten holding in Investec Global Special Situations*, is my long-term hero ever since the Uber Cash incident.
*Source: fund factsheets, end of June 2019
**Source: Statista, Distribution of Facebook users worldwide as of July 2019, by age and gender