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Much to their irritation, twenty-somethings tend to be seen as financially feckless, more obsessed with brunch than prudence and more drawn to bitcoin than blue-chip shares.

Most reporting of this age group’s investing focuses on the fondness among young Americans for ‘meme stock rallies’ that aim to drive up the depressed price of a company like Gamestop, the video games chain – thus embarrassing hedge funds who have ‘shorted’ the shares.

These counter-cultural forays, inspired by tips on Reddit’s Wall Street Bets, are executed on Robinhood, the trading app designed for Gen Y. 

Unfair reputation: Twenty-somethings tend to be seen as financially feckless, more obsessed with brunch than prudence – but this is rarely the case

However, in reality, millions more Americans in their 20s and 30s are stashing away cash in a 401K, a long-term stock market savings scheme.

Now British twenty-somethings are also adopting the habit.

During lockdown many more younger customers joined the AJ Bell, Hargreaves Lansdown and Interactive Investor platforms.

These financial supermarkets allow you to deal in individual shares, or put money into collective schemes, funds and investment trusts.

During the second quarter of this year, 18-to-24-year-old Interactive Investor customers achieved an average return of 6.2 per cent, against 5.7 per cent for those aged between 25 and 35 and 5.2pc for those in the 55-64 group.

Moira O’Neill of Interactive Investor says its youngest clientele have led the field since January 2020, targeting opportunities among investment trusts (companies that own shares in other companies). Top sellers include Alliance, Monks and Witan, whose portfolios are suitably diversified.

The favourite trust among this digital-native clientele is the £19bn Scottish Mortgage, whose speciality is technology – in every form from Tesla to Moderna, the Covid vaccine company.

Scottish Mortgage’s stakes in enterprises that are not quoted on a stock market, like SpaceX, the rocket company, and Tiktok owner Bytedance, are one reason why many in middle age (including me) have bought into this trust. We like the element of adventure.

If you are ready for thrills and spills then venturing into the stock market makes sense, provided you have built up a cash buffer. Since you are unlikely to need income from your investments in the short term, you can benefit from compound interest.

Roger Roberts of Timothy James & Partners, the independent adviser, explains: ‘If you reinvest the dividends your investment will grow more over time.

‘If a £10,000 investment generates an income of 2.5 per cent a year and the investment grows by 5 per cent a year, it will be worth about £26,000 in 10 years time if you take the income. 

But if you reinvest, it could be worth about £40,000 in 20 years.’

Very few twenty-somethings have a spare £10,000, but many can set aside £100 a month, allowing them to benefit from ‘pound cost averaging’. 

When markets dip, your contribution buys a bigger slice of a fund or trust, lowering the overall cost of your stake.

Roberts says: ‘If you put aside £100 a month – let’s assume a 6 per cent annual return – then the total investment of £12,000 will turn into £16,000. 

But if you continue for another 10 years, having invested £24,000 in total, this should generate £44,000.’ 

All the platforms have best buy fund and trust lists. These recommendations include funds that are passive, or index-linked, that is based on the constituents of a stock market index – and others that are actively managed by human experts.

Roberts’ passive selection is Vanguard LifeStrategy 60 per cent Equity. For those prepared for a gamble, he suggests Baillie Gifford Managed, where UK companies make up 20 per cent of the portfolio.

O’Neill says that the BMO Sustainable Universal MAP Growth fund should suit beginners. 

The F&C investment trust focuses on the likes of Amazon and Taiwan Semiconductor Manufacturing Company (TSMC). 

Investing in shares is not a sure-fire means of making money, whether you are 25, or 65. But if you are young, it is the best time to get the party started.

Share of the week: Barratt Developments 

Developers have been riding high thanks to the booming housing market.

But rising costs have been a long-standing worry and these pressures are only likely to have grown as supply chain crunches squeeze a dizzying array of businesses.

So when FTSE 100 builder Barratt updates this week, investors will be paying close attention to how inflation is impacting them. Crucially, they will want to know whether the firm has managed to protect its profit margins.

At the same time, with the market showing signs of cooling – after price growth slowed in July following the end of the stamp duty holiday – there will be lots of interest in how sales have been so far in the second half of this year.

Barratt will report its full-year results on Wednesday. Analysts expect the firm – the UK’s biggest housebuilder – to post a rise in full-year revenues of £3.4billion to £4.8billion for 2021, with profits expected to increase from £506million to £878million.

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said the question of whether recent strong demand can continue will be on investors’ lips.

Elsewhere, upmarket rival Berkeley will give an insight into a different part of the market. 

The firm, which focuses on more expensive homes and mainly in London and the South East, will follow Barratt on Thursday with a trading update. It is expected to post full-year revenues of £2.2billion, up from £1.9billion in 2020.

Meanwhile, profits at the firm are expected to rise from £504million to £532million.