One of the “secret weapons” for why the consumer has held up so well, and continues to spend in North America, is an important and little-appreciated fact: Consumers are getting older (and wealthier).

 

Almost 18% of the US population is now 65 years or older, the highest on record going back to 1920, and close to double what is was in 2010. It is estimated that in North America, those aged 65 and up accounted for 22% of spending last year, the highest share since records of this began.

 

 

So this significant cohort, that is the least likely to have mortgages or debt, they also benefit most from the returns available risk-free in higher savings rates. This has made them a spending force to be reckoned with. Americans age 70 and older now hold nearly 26% of household wealth, the highest since records began in 1989. Baby boomers alone have now amassed $77.1 trillion in wealth. South of the border, retirees also received an 8.7% cost-of-living-adjustment bump to Social Security payments in January, the largest single-year increase since 1981, and an automatic adjustment to offset last year’s 9.1% inflation peak. All of these factors have cushioned seniors from many of the challenges that inflation and high interest rates have created.

 

On the subject of our senior citizens: they weren’t around when the first airplanes flew in the sky, or Horses were displaced by the combustion-engine. But last week, I experienced what I felt was a similar game-changing shift that those in the generations before would have witnessed, the first time they saw a car, or a plane in the sky: A seismic shift in transportation. I was in San Francisco, and our whole family, in our car: from kids to grandparents all mesmerized seeing this white car below, being driven by a robot, with a passenger in the back seat reading his paper. I have no doubt that at some point in the future, we will be staring in wonder at those who chose to drive their own car. This would be the same as when cars took over the roads, and presumably people would laugh at those still being drawn by a horse…

 

 

Please be kind, compassionate and supportive in the face of the trauma and tragedy that has occurred over the past days.