New research shows that younger Australians are more likely to invest their money in the stock market and cryptocurrencies, and they are more likely to use a subscription service to access an electric vehicle, rather than opt for the traditional ownership model of financing a new car.
The study was commissioned by car subscription company Loopit, which found that the younger generation no longer sees value in tying up their cash in a new car, and paying interest on a depreciating asset.
The research also finds the majority of young people (61%) have one or more financial investments, compared to 40% of older Australians. The data found that younger generations are turning to investments outside their super and primary dwelling at higher rates than older generations, with 66% of young people investing in cryptocurrencies, compared to 6% of older Australians.
Millennials are driving the popularity of more flexible alternatives to car ownership, such as subscription. According to the study, 68% of young people would consider subscribing to their next car, compared to 46% of older Australians.
“The idea of paying interest on a car loan over five years for a depreciating asset just doesn’t stack up anymore for our generation like it did for the Boomers,” Loopit co-founder and managing director Michael Higgins says
“They’d rather see that money put to work in the stock market or towards buying a first home. Most importantly, a car subscription doesn’t tie up their funds – so they can continue investing or working toward their first home savings goal.”
The study found that people with investments such as stocks and cryptocurrencies are more likely to subscribe to their next car than buy it outright. More than 75% of Aussies with financial investments would consider subscribing to their next car rather than buying it – this figure drops to just 45% for people without any investments.
The data also showed a link between financial investments and electric vehicle (EV) adoption.
It shows that 81% of Aussies who have financial investments are more likely to drive an EV in the next five years, with subscription being their preferred way to get behind the wheel. The data shows 64% would prefer to subscribe to an EV than buy it outright.
HelloCars co-founder and managing director Paul Higgins say this research highlights that drivers are looking for a more flexible and affordable alternative to upgrading their car.
“Even though EVs are around the corner, cost has been cited as the biggest barrier for Aussie drivers – even the most affluent people can’t afford to upgrade their car as frequently as subscription allows,” Higgins says.
“People don’t want to commit to buying a new electric car, but the flexibility and affordability of subscription means you can update your car even more often than your phone.” he says.
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