Seniors to boost spending by 230%: BMO

The aging population won’t necessarily have a negative impact on the U.S. economy, according to BMO Senior Economist Sal Guatieri.

Read: Discuss overspending with retirees

While seniors tend to spend significantly less than middle-aged people, any concerns about the negative ramifications on the economy are largely countered by the fact that the next generation of seniors is expected to increase spending by a whopping 230% over the next two decades — more than twice as fast as everyone else (15 to 64).

In a little over a decade seniors are expected to become a powerful spending force, accounting for one-in-five shopping dollars versus one-in-seven today. Furthermore, the senior population is expected to grow 69% by 2033.

“Future retirees will be the wealthiest ever, and are expected to live and work longer, travel more, and be more active than the current generation of seniors,” says Guatieri. “An upward shift in the spending of seniors has already occurred. Between 2001 and 2011 the average expenditure of individuals 65 and over jumped 41%, fifteen percentage points faster than the general population. Seniors spent at a faster rate on nearly everything, including food, clothing and entertainment, with the latter almost doubling.”

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.