Rich young Americans are ditching the stock market
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The stock market has long been the go-to choice for people looking to invest their money. But that could be about to change as a younger generation — with a preference for alternative investments outside the shaky stock market — enters the scene.
According to a survey from Bank of America, individuals aged 21 to 43 with at least $3 million in assets only have 25% of their portfolio invested in stocks — compared to 55% for wealthy investors aged 44 and older (1).
Most rich, young Americans (93%) say they plan to allocate more of their portfolio to alternatives in the next few years. So, what alternative investments are capturing the interest of these young millionaires?
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A golden opportunity to hedge against inflation
The Bank of America survey revealed that among wealthy young investors, 45% own gold as a physical asset, and another 45% are interested in holding it.
Historically, gold has served as a hedge against inflation and market volatility. Many investors turn to “safe haven” assets like gold during economic and geopolitical instability to preserve their wealth.
The enthusiasm of investors has indeed propelled the price of gold to record levels, with the precious metal recently sitting around the $4,000 per ounce mark as of July 2026 (2).
There are lots of gold assets to choose from, including gold bars, coins and gold stocks.
One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of Priority Gold.
Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold, making it an attractive option for those looking to potentially hedge their retirement funds against economic uncertainties.
To learn more, you can get a free information guide that includes details on how to get up to $10,000 in free silver on qualifying purchases.
Real estate: rich with opportunity
Real estate has long been considered a solid portfolio hedge, as rent and property values tend to increase with inflation. It’s no surprise that high-net-worth individuals — regardless of their age — see opportunity in this asset.
In the Bank of America survey, 31% of younger people said real estate presents the greatest opportunities for growth. Federal Reserve data also shows that the top 1% of Americans hold over $6 trillion in real estate assets.
One way to invest in real estate is by purchasing rental properties and becoming a landlord. But for the average American who wants to avoid the need for a hefty down payment or the burden of property management, crowdfunding platforms like Arrived make it easier to slice yourself up a piece of that pie.
Backed by world-class investors like Jeff Bezos, Arrived allows you to invest in shares of rental homes with as little as $100, all without the hassle of mowing lawns, fixing leaky faucets or handling difficult tenants.
The process is simple: Browse a curated selection of homes that have been vetted for their appreciation and income potential. Once you find a property you like, select the number of shares you’d like to purchase, and then sit back as you start receiving any positive rental income distributions from your investment.
mogul is a real estate investment platform offering fractional ownership in blue-chip rental properties, which gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or 3 a.m. tenant calls.
Founded by former Goldman Sachs real estate investors, the team hand-picks the top 1% of single-family rental homes nationwide for you. Simply put, you can invest in institutional quality offerings for a fraction of the usual cost.
Each property undergoes a vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18.8%. Their cash-on-cash yields, meanwhile, average between 10 to 12% annually. Offerings often sell out in under three hours, with investments typically ranging between $15,000 and $40,000 per property.
Every investment is secured by real assets, not dependent on the platform’s viability. Each property is held in a standalone Propco LLC, so investors own the property — not the platform. Blockchain-based fractionalization adds a layer of safety, ensuring a permanent, verifiable record of each stake.
Getting started is a quick and easy process. You can sign up for an account and then browse available properties. Once you verify your information with their team, you can invest like a mogul in just a few clicks.
But high-net-worth investors might benefit from conducting thorough due diligence before investing in relatively illiquid assets like real estate and gold. Depending on how they’re structured, these assets can be complex — especially when it comes to taxes and investment horizon.
Artwork: a creative way to diversify
More than 72% of younger investors (ages 21-43) believe it is no longer possible to achieve above-average investment returns by investing solely in traditional stocks and bonds. Art is one of the alternative investments that has captured the attention of smart investors.
With over $67 billion in annual transaction volume and a total estimated global value of $1.7 trillion, art represents a massive asset class, according to Deloitte.
In fact, fine art has historically outperformed the S&P 500, with contemporary art achieving an annual return of 11.5% from 1995 to 2023, compared to the S&P 500’s 9.6% during the same period.
Until recently, this world was off-limits. Now, with Masterworks, you can buy fractional shares in multimillion-dollar works by icons like Banksy, Picasso and Basquiat. While art can be illiquid and typically requires a long-term hold, it offers unique portfolio diversification.
Masterworks has sold 31 artworks so far, yielding net annualized returns like 14.6%, 17.6% and 17.8%.*
Moneywise readers can get priority access to diversify with art: Skip the waitlist here.
**Past performance is not indicative of future returns. Investing involves risk. See important Regulation A disclosures at [*Masterworks.com/cd](http://masterworks.com/cd](https://www.masterworks.com/about/disclosure))
Private equity investing
Private equity refers to investments in companies that are not publicly traded on a stock exchange. This asset class involves investing directly in private companies, often during their growth stages or through buyouts.
It remains a popular choice among young investors seeking higher returns and more control over their investments.
The Bank of America survey showed that over 25% of young wealthy millionaires identified private equity as one of the greatest growth opportunities.
While private equity offers significant upside potential, it also requires a longer-term commitment and comes with higher risks than public equities.
Private equity is a broad category that spans a wide range of assets. So, finding a firm that can help you allocate your capital to the right assets could be a way to dip your toe into this lucrative category.
Cryptocurrency: more than a craze
Investors used to be skeptical about cryptocurrency, perhaps due to its speculative and highly volatile nature. But it has now entered the mainstream, and especially with President Trump vowing to create a “strategic national Bitcoin stockpile”, crypto has surged to a global market cap of $3.72 trillion.
It’s no surprise that the wealthy millennials and Gen Z are fond of this asset class. In the Bank of America survey, 29% of younger people said cryptos offer the greatest opportunities for growth, while only 7% of the older group agreed.
Rich young Americans also allocated 15% of their portfolios to crypto, compared to 2% of the older generation.
If you’re looking to diversify beyond traditional stocks and ETFs, Robinhood Crypto lets you buy and sell cryptocurrencies with as little as $1.
With some of the lowest trading costs on average in the U.S., you could end up with up to 2.7% more crypto compared to other platforms.
Robinhood Crypto makes it easy to make investing a habit with recurring buys on a fixed schedule, while giving you access to all your favorite coins — from Bitcoin and Ethereum to Solana, Dogecoin, XRP, and more.
You can also transfer crypto securely to other wallets, set custom price alerts, track market trends, and manage your portfolio all in one place.
Robinhood ensures the security of your cryptocurrency is a top priority, with the majority of coins held in offline cold storage. Robinhood also carries crime insurance against theft and cyber breaches, and 24/7 customer support is available if you need help.
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see oureditorial ethics and guidelines.
Bank Of America (1); GoldPrice.org (2)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.