Mutual funds may have tough times ahead, in remaining the investment of choice for a new generation of Americans. Their bread and butter: Older investors. Their weak spot: Investors under 35.

In an analysis of ownership of mutual funds conducted by its economists, the Investment Company Institute in November found that only 44% of investors under 35 who were familiar with mutual fund companies had a "very" or "somewhat" favorable impression of them.

That's a big drop-off, from their parents and other older Americans, who helped the funds grow from $769.2 billion in assets in 1986 to $11.6 trillion by the end of last year, a quarter century stretch.

To put that in perspective, the industry held $3,203 for each of 240.1 million Americans 25 years ago. Last year, it held $37,203 for each of 311.8 million. A pullback over the next 25 years could have impact of similar magnitude.

The main strength of mutual funds is now the aging investor. Nearly two-thirds of mutual fund owners aged 50 to 64 have favorable impressions of mutual fund companies. But an even bigger love affair is with those fund owners at retirement age or older.

Seventy-four percent of share owners aged 65 and older, the ICI study found, view mutual funds favorably. And investors whose first mutual fund purchase was made before 2000 were also more charitable in their views towards funds, than those who have invested since the dotcom bubble burst in 2000 and 2001 and the credit crisis erupted in 2008 and 2009.

Tellingly, the investors now willing to take more risks-and presumably move away from investments in groupings of stocks and bonds-are younger. "Younger households tend to be more willing to take investment risk than older households,'' say the report's authors, Daniel Schrass, Michael Bogdan and Sarah Holden.

Only 13% of households with heads who are 65 years old or older are willing to take above-average risks in their investment choices. By contrast, 39% of households headed by men or women 35 or younger are, in 2012. In fact, the youngest age group is increasingly willing to take risks, they found. In 2011, only 31% of those 35-and-under households were willing to take above-average risks.

A separate Bank of America Merrill Lynch Affluent Insights survey in September is even more stark. This year, it found 23% of younger investors aged 18 to 34 describe themselves as conservative, compared to 52% two years ago; while 23% of those ages 35 to 50 describe themselves this way, compared to 45% two years ago.

That bodes well for investments that offer alternatives to traditional stock and bond funds. These competitors range from exchange-traded funds to gold to real estate. To reach the younger investors, financial advisors and mutual fund companies are going to have to change their marketing ways and means of achieving face-to-face relationships.

Internet access, according to the ICI report, is nearly universal. In 2012, 92% of households with heads aged 50 to 64 have Internet access. That goes up to 95% for those aged 35 to 49 and drops back to 93% for those under 35. The laggards: Those over 65, at 77%.

But it's the education of the users and the wealth that is, in this case, telling. Ninety-six percent of households where the head has a college or post-graduate degree have Internet access. Only 78% of those with high-school educations do. Similarly, only 75% of households with annual incomes under 50% have access to the Internet. But 98% of those with incomes of $150,000 or more do.

Regardless of age or income, however, the heaviest users of the Internet are those aged 35 or under, who use it once a day or more. Close behind: Those aged 35 to 49. Way behind: 65 and older.

That can be leveraged, at this point, by mutual fund companies. According to the ICI report, 81% of mutual fund owners use the Internet to access information on bank or investment accounts, compared to just 55% of individuals who don't own mutual funds.

In the same vein, 56% of mutual fund owners get investment information from online sources, while only 21% of individuals who don't own mutual funds do.

A study by the Cisco Internet Business Solutions Group, a unit of the Internet router technology company, finds that younger investors increasingly want to use video systems to interact with their financial advisors and other industry experts.

Roughly 60% of investors under the age of 55-who control 37% of wealth-are either somewhat interested or extremely interested in meeting with financial experts via high-definition video. They are looking, the study said, for the experts and advisors to be in the advisor's office, at a scheduled time. The video meeting would replace an in-person meeting.

This is important, says one of the report's co-authors, Robert Waitman, because it's the under-55 investor who is most "at risk" of moving from one financial advisor to another or to move funds from one place to another. Roughly 20% of those under 55 expect to make a change in the next year. By contrast, only 4% of those over 55 do.

The younger investors "are the ones that are very much in play, if their investments are not turning out as they like,'' Waitman said.

Fund companies and financial advisors also need to find ways to communicate with their future investors through social media, such as Facebook, Twitter or LinkedIn. While that is not necessarily a surprise, the numbers are fairly stark. In households where the head is aged 55 or under, 29% look to investment professionals for guidance. But 27% look to peers.

That almost flips the traditional model. For households where the head is 65 or older, 61% look to pros for guidance and only 3% look to peers. Similarly, 26% of individuals under 55 have contributed in some fashion to an investment blog, according to the Cisco study. But only 7% or fewer of individuals over 55 have.

"This is in its infancy,'' said Waitman. "But we already see that social networking activity relative to their investing lives is important'' to the younger investors who will make up the bulk of assets held by the mutual fund industry 25 years from now.

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