Ancestry and Investing

10/1/2022

Where one’s family came from can have a significant impact on an individual. Favorite meals, appearance, mannerisms, and habits can all have origins in where their family originated from. When someone’s family has been in the United States for many generations this may be less noticeable than for someone who is first generation. Do family origins impact other components of an individual’s life? Will investor’s risk tolerance or investment choices be impacted by their family’s nationality?

Spectrem Group wanted to investigate the connection between family nationality and financial matters, and some of the findings were very surprising. Before an investor can decide where to invest, or if they use an advisor or not, investors most often conduct their own research. How does family origins impact research on investments? Over a third of investors feel that their family origins do not have an impact on how they research investments. Thirty-six percent of investors feel that their family origins are at least somewhat important when conducting their own research on investments. Twenty percent of investors feel that their family origins are unimportant regarding how they conduct research on investments.


After research is conducted, investors then choose where to invest. Does family nationality impact where investors choose to invest? Family nationality is important in where investors choose to invest in for 20 percent of investors. Just over a quarter of investors feel their family nationality is neither important nor unimportant, while 38 percent feel it is unimportant. Choosing investments also requires an assessment of an investor’s risk tolerance.

Is risk tolerance impacted by an investor’s family origins? Over a quarter of investors feel that they are somewhat risk adverse due to their family origins, while 15 percent of investors are more aggressive in their risk tolerance as a result of their family origins. Thirty-one percent of investors consider themselves to be moderate investors as a result of their family origins.

Advisor usage is also impacted by an investor’s family origins for many investors. Sixty-one percent of investors feel their family origins impact their views on using an advisor. Advisor usage is a highly personal decision and should not be a decision taken lightly. When investors work with an advisor, they should share if any of their family heritage or origins have the potential of impacting their risk tolerance, investment decisions, or manner in which they conduct financial research.