While overall U.S. retail investment growth is slowing, younger investors remain drawn to crypto, options, and meme stocks, even as financial literacy gaps widen, according to new 2025 research from the FINRA Investor Education Foundation.
A study conducted by the FINRA Investor Education Foundation (FINRA Foundation) combines a state-by-state online survey of 25,539 U.S. adults with an X investor survey of 2,861 adults holding investments outside retirement accounts.
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The researchers found out that the number of new investors joining the market has fallen sharply. Only about 8% of investors reported starting in the last two years, down from roughly 21% in the pre-2021 period.
Overall, the share of U.S. adults holding investments outside retirement accounts stayed roughly the same since 2021. However, in 2024, fewer young adults (21% vs. 26%), men (40% vs. 43%), and people of color (29% vs. 36%) reported owning these investments, wiping out much of the gains seen in the previous survey.
Crypto, Meme Stocks, and High-Risk Engagement
The research results showed that interest in cryptocurrency is also slowing. While 27% of investors held cryptocurrency in 2024, unchanged from 2021, the share considering new crypto investments fell to 26% from 33%.
Meme stock trading remains popular among younger investors. About 13% of all investors said they have purchased such stocks, and nearly 30% of these participants are under 35.
Younger investors rely less on financial professionals and more on peers and social media. Among those under 35, 85% use word-of-mouth advice, 61% rely on social media for investment information, and 61% follow recommendations from influencers or trading app communities.
For meme stock buyers, 78% report following their trading app suggestions, and 69% rely on online groups.
Source: FINRA
Risk Tolerance and Knowledge Gaps
The industry regulator found that fewer investors are willing to take big risks. In 2024, just 8% were, down from 12% in 2021. Among those under 35, it fell to 15% from 24%.
Still, many feel pressure to take risks. Overall, 34% of investors, and 62% of younger ones, say big risks are needed to reach their financial goals.
Knowledge gaps remain significant. Respondents correctly answered fewer than half of the investing quiz questions on average, with margin and short-selling questions particularly challenging.
Concern about investment fraud is rising: 37% of investors report worry about scams, up from 31% in 2021.
Why This Matters
The findings show younger investors continue to engage heavily with crypto and meme stocks, even as overall risk tolerance declines and knowledge gaps persist.
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People Also Ask:
High-risk investments include cryptocurrencies, meme stocks, options trading, margin trading, and other volatile or speculative assets.
These assets offer high growth potential, fast trading opportunities, and strong social media or community engagement.
Many rely on peers, social media, online communities, or trading apps, rather than professional financial advisors.
Yes. Younger investors often engage in higher-risk strategies but may also report lower overall risk tolerance compared with their ambitions to grow wealth.
