Baby Boomers grew up during periods of dramatic social change and they are often known as being a generation of trendsetters. Yet Baby Boomers may not realize that they are the single largest economic group in the United States. They have more discretionary income and their spending habits can greatly effect the changing economy.
According to Baby Boomer Magazine, the Baby Boomer generation currently has more discretionary income than any other age group. They control most of the net worth of American households and they account for 40 percent of total consumer demand.
Baby Boomers have been known to revitalize areas when they move in and build new homes. They support their own local communities as they pay for their home utilities and buy gas for their cars. They tend to eat out more than younger people, which supports local restaurants, and take advantage of many services such as spa treatments and salon visits. Baby Boomers also travel more than other age groups, supporting cities and towns throughout the country as well.
Marketing campaigns frequently target Baby Boomers and their spending has often been a boon to the economy. This is particularly important during economic downturns when spending can support local businesses and help stimulate the general economy. However, some experts wonder how trends will change as this spending generation continues to mature.
Baby Boomers are reaching the ages when they are inclined to spend less on accumulating more “stuff.” Having already filled their homes and raised their families, Baby Boomers often turn more toward buying experiences than physical items. This may mean that their spending will continue to turn toward travel, dining out and activities like golf, tennis or lifelong learning classes. Sporting events, concerts and other live performances are other experiences which Baby Boomers now enjoy as part of an active adult lifestyle.
Of course, Baby Boomers who no longer buy many items for themselves are still likely to spend money on their loved ones. As empty nesters become grandparents, they tend to turn their spending power toward gifts for their grandchildren. Some retired Baby Boomers even take on babysitting responsibilities which leads to spending on family-friendly activities like trips to zoos and amusement parks.
Though Baby Boomers are the country’s single largest economic group, they may not be aware of how their spending affects the rest of the economy. Even financial experts may not yet know just how the economy will be affected as Baby Boomers mature and continue to change their spending habits.