The Impact of Investment-Oriented Financial Strategies on Asset Formation Among Youth: Evidence from Young Adults in Seoul

This study examines how different types and patterns of investment activities affect asset accumulation among young adults residing in Seoul. Utilizing data from the Seoul Youth Panel Survey conducted by the Seoul Institute, the analysis is structured in two stages. In the first stage, Latent Class Analysis (LCA) was employed to categorize youth into three distinct financial behavior groups: Balanced-Oriented, Opportunity-Seeking, and Stability-Seeking investors. In the second stage, a panel regression analysis was conducted to assess the effects of each investment type and category on household asset accumulation. The findings reveal that the Opportunity-Seeking group shows a statistically significant positive impact on asset formation compared to the Stability-Seeking group. In contrast, the Balanced-Oriented group does not demonstrate a significant difference relative to the Stability-Seeking group. Furthermore, among various investment types, real estate investment was found to have the most substantial influence on asset growth. These results highlight the differentiated effects of investment behaviors on wealth accumulation and provide critical implications for developing tailored policy interventions that reflect the diverse financial strategies of young adults in urban contexts.