The Baby Boomers: 76 million people currently between the ages of 53 and 71 who are significantly impacting the U.S. economy. This group is not only increasing the demand for certain services and goods, but, because of their spending habits, they are boosting the economy in a way no other generation has the ability to do.
Statistics show that 35% of Baby Boomers have a household income of over $100,000. Furthermore, because of continued household incomes for Baby Boomers, they control 70% of the nation’s disposable income.1 This group of individuals over the past decades has been known to make informed financial decisions and to be active participants in their local and global communities. As such the money controlled by these individuals continues to flow back into the economy as the Baby Boomers invest and consume. During the first quarter of 2017, Americans 55 and older accounted for 41.6% of consumer spending, up from 33.5% in 2007.2 Research suggests that the over 50 age group will continue to dominate U.S. spending for the next five to 10 years.3
Baby Boomers are expected to make major contributions to the medical economy. With their demand for healthcare services is on the rise as they age, Baby Boomers are expected to increase annual spending on wellness-based services from approximately $200 million to $1 trillion.4 Projections suggest that the average healthy 65-year old couple will spend about $250,000 for premiums, cost-sharing provisions and out-of-pocket costs associated with Medicare parts A, B, and D during retirement. They will spend additional amounts for over-the-counter medications, dental services, and long-term care.5 In 1999, Medicare Part A spending totaled $107.8 billion. That amount is expected to rise to $259.8 billion in 2030 and to $287.5 billion in 2050.6
Currently controlling 70% of the nation’s disposable income, accounting for 41.6% of the nation’s consumer spending with a clear expectation that their spending will not only remain consistent but will increase over time, Baby Boomers are driving today’s economic trends. And if they’re not a strong enough force now, data reveals that an additional $8.4 trillion will be inherited by Baby Boomers by 2030.7
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1. Baby Boomer Report 2015 published by U.S. News & World Report https://www.usnews.com/pubfiles/USNews_Market_Insights_Boomers2015.pdf
2. The economy is still all about -- who else? – Boomers published by USA Today https://www.usatoday.com/story/money/2017/07/17/economy-still-all-who-else-boomers/476908001/
3. Gray is the new black: Baby boomers still outspend millennials published by Visa https://usa.visa.com/partner-with-us/visa-performance-solutions/baby-boomers-still-outspend-millennials.html
4. Baby Boomer Report 2015 published by U.S. News & World Report https://www.usnews.com/pubfiles/USNews_Market_Insights_Boomers2015.pdf
5. Health Care Costs for Retirees Rise to an Estimated $275,000 Fidelity Analysis Shows published by Fidelity https://www.fidelity.com/about-fidelity/employer-services/health-care-costs-for-retirees-rise
6. Baby Boomers and Medicare published by Health Affairs http://content.healthaffairs.org/content/23/2/282.2.full
7. Appealing To The Affluent Older Consumer: A Retail Guide published by Forbes https://www.forbes.com/sites/bryanpearson/2017/01/03/appealing-to-the-affluent-older-consumer-a-retail-guide/#526a48986d72