• by Sarah Mahoney  @mahoney_sarah, August 31, 2011

Today's grandparents aren't the thrifty geezers most marketers think they are, according to the latest research from Metropolitan Life. The majority are working-age Baby Boomers between 45 and 64, and they're spending lavishly on everything from new trikes to college tuition.

Right now, that age group commands 46% of the nation's total household income, the report finds. In total, the grandparent-age share of the nation's income rises to 60%, 10 percentage points higher than it was in 1980. And thanks to the tens of millions of ready-to-spawn Millennials, the grandparent club is growing at twice the overall population growth rate. In 2010, there were an estimated 65 million grandmothers and grandfathers; by 2020, 80 million, or one in three adults, will be answering to Nana or Poppa.

It's clear to these grandparents that their kids have taken the hardest hit in the recession, John Migliaccio, director of research for the MetLife Mature Market Institute, tells Marketing Daily. While real income has increased for those in the grandparent age group, the total real income of households ages 25 to 44 (most of whom were the adult children of those ages 55 or older) declined from 43% to 36%.

"We were surprised at the generational differences. Many of the grandparents were affected by the economic downturn, but did relatively better than their kids did, and were able to step in and provide assistance," he says.

And assist they did: In 2009, households ages 55 or older spent $7.6 billion on things like infant food, equipment and clothing, toys, games, and tricycles, a 71% increase since 1999. And they spent $2.43 billion on primary and secondary school tuition and supplies, about three times more than in 1999.

But the generous behavior is as much about values as it is economics, he says. Many of these grandparents are first-wave Baby Boomers who saw themselves as reinventing parenthood when they had their kids 20-some years ago, "so it's not so surprising that they are seeking to redefine grandparenting, too. This is a group that is much more likely to have gone to college than previous generations, with about 37% college educated. They traveled more. They grew up in a period of social and political turmoil. And there is a real sense of obligation and responsibility," he says, "especially about education. They are much more focused on leaving a legacy."

And while much has been written about the flightiness of Millenials, who are sleeping on Mom and Dad's couches in record numbers, he doesn't think the older parents seriously doubt their kids' ability to be responsible. "It's just that they recognize that if they've got, let's say, a 27- or a 28-year-old, this recession really had a big impact. So we are seeing the parents, often at a cost to their own retirement plans and portfolios, wanting to pull together in tough times. They aren't just keeping track of their own issues, but also the issues of their kids and their grandkids."