Recently my columns have focused on millionaire consumers, those with a personal net worth (total assets less total liabilities) of $1 million or more. The columns have generated some interesting feedback regarding the wealthy, who number about 20 million adults according to our projections based on Bureau of the Census estimates.
During the past few weeks, readers have asked which of the generations has the most spending power. The media has increasingly been focusing on Millennials as the generation to target, but is that a good business strategy? We believe it’s only part of a good business strategy. While adults of the Millennial generation — especially upscale Millennials — are becoming prime targets of the marketing community, an even more valuable and affluent segment, the Boomers, have recently been going largely unnoticed and not mentioned. Following are our estimated shares of personal net worth held and income received (estimates from the Bureau of the Census) by each generation (the estimated number of adults in each generation follows the generation’s name):
Share of Total Share of Total
Generation (size) Net Worth Dollars Income Dollars
Millennials (67.9 million) 21% 18%
Gen X (60.4 million) 29% 31%
Baby Boomers (74.9 million) 34% 39%
Seniors (33.7 million) 16% 11%
Notably, the 75 million Baby Boomers, the largest generation, who constitute 32% of all U.S. adults 18 and older, hold 34% of estimated net worth dollars and earned 39% of total income dollars, while Millennials, the up-and-coming generation (about 68 million adults), hold 21% of estimated net worth dollars and earned 18% of total income dollars.
A further look at the Baby Boomer generation reveals findings that marketers should not ignore, including:
For marketers focused on affluent Boomers (those with household incomes of $250,000+ or personal net worth of $1 million or more):
Given the fact that Boomers are the largest adult generation with the highest proportions of income and wealth, it would be wise for marketers and the media alike to keep their eyes on this very valuable target market. Even as marketers cultivate and engage Millennials, who will eventually replace Boomers as the #1 generation in spending power, they shouldn't let the Boomers — especially upscale and affluent Boomers — pass them by.