U.S. Spending Patterns Are Making Change : Study Cites Clout of Aging Baby Boomers

A drastic shift in spending patterns is under way as America’s baby boomers enter middle age and their wallets grow fatter.

The finding that emerged from a study commissioned by Prevention magazine that nearly 47% of American adults will fall into the 35-to-59-year age group by the turn of the century is no surprise.

But the study, prepared for Prevention by the National Planning Data Corp. based on U.S. Bureau of Labor statistics, also revealed that middle-aged Americans will be the spending leaders--by sometimes surprisingly large margins--in virtually every category examined.

Between now and the year 2000, the income and expenditures of middle-aged Americans are projected to outpace the rate of increase in the group’s size. In effect, middle-aged consumers will have spending sway over 60% of all income, the study showed.

Moreover, as this group inevitably redirects the ways in which it spends, businesses will be required “to reassess their selling strategies,” the study noted.

“A direct result of the advancing age of the population means that consumers have different interests, priorities and outlooks on life,” said Kurt Barnard, publisher of Barnard’s Retail Marketing Report in New York. “We’ll see these people much more willing to spend, say, $1,000 for new drapes than for several new dresses.”

Looking at the years 1988-1993, the Prevention study said projected spending increases by the middle-aged will grow between 17% and 28% for the six-year period in such important categories as food, personal-care products and footwear.

Specifically, purchases of food for the household by the 35-to-59 age group will grow 17.3% to $115.7 billion, compared to a projected decline in such purchases for those aged 18 to 34 and a small increase for those 60 or over.

Middle-aged consumers are expected to be the biggest spenders at restaurants, too. A 27.8% increase in expenditures to $76 billion is anticipated from the group in the 1988-1993 period, far outpacing both younger and older counterparts.