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The Mature Market Plans Well, Lives Well, and Is Well

We’ve never had a population this size this old before. There are nearly 52 million people in the United States who are age 65 or older, according to the U.S. Census Bureau. And, by 2060, the demographic will double in size to 95 million people. Isn’t that mind-boggling?

Not to be overlooked, the 50-plus age groups hold 75% of all personal wealth, says Media Metrix, a digital audience measurement service.

The over 50 crowd are dissimilar to their 1950s and 1960s predecessors. They are smoke-free, healthier and more vibrant. They have saved more money and have more disposable income to spend on gas, gadgets, guitars and groceries than at any other time, which may explain why more investment and wealth management firms advertise on TV.

Today’s More Attractive Grey Market

While the 18-49 demographic watches everything but broadcast TV for most of their viewing time, they literally opened the doors for marketers to jump in head first to target the 50-plus markets. As a result, more 30-second TV commercials feature 50-plus than ever before – and they aren’t just hawking medicinal products.

Many of today’s affluent 50-plus and 65-plus seniors are enjoying their luxurious lifestyles. They earned it, and broadcast TV glamorizes it with ads showing smiling, robust younger grandparents frolicking in their attractively styled active adult communities, at the pool, on the tennis courts, in the fitness room, and at the tiki bar dancing and enjoying happy hour.

Top-notch marketers determined it was time to really show off the adults that control a household net worth of $19 trillion. Suddenly Senior reported that the mature market has more than $1.6 trillion in spending power and a net worth that’s almost twice the U.S. average.

And while senior websites like Suddenly Senior and have captured the trust and attention of the wealthiest consumer on the planet, their many devotees credit their wealth management advisors for their meticulous planning and projecting. We, too often hear this at Hefren-Tillotson. Many of our affluent clients tell us they feel comfortable with their advisors on a personal level and view them as skilled professionals.

What Women Say

Taking it one step beyond, research reported in Forbes magazine from the Hearts & Wallets financial research firm found that when women and men 50-plus were asked what they want from financial advisors and financial services firms, the percentage of women saying they wanted something was far more than men:

  • For women 45 to 54, explains things in understandable terms was the biggest difference between what women and men said they wanted from financial advisory firms. Some 61% of women rated this high in importance vs. just 41% of men.
  • Clear and understandable fees were rated highly important by 66% of women vs. 51% of men. And a reasonable fee was deemed highly important by 65% of women compared to 51% of men.
  • For women 55-64 and women 65+, the biggest gender difference with men was explains things in understandable terms. 65% of women 55 to 64 and 67% of those 65+ rated this of high importance vs. 49% of men and 47% of men, respectively.

Women over 55 also felt far more strongly than men about the importance of reasonable fees and clear and useful statements. Other factors deemed important to women in the category:

  • A person or team assigned to their account
  • Online account access tools
  • Clear and useful statements
  • Advisors sharing their values

Women forty-four years old and younger are not more demanding than men. However, for women in all age categories, an advisor who partners with them and ‘explains things in understandable terms’ is rated higher in performance than it is for men.

Who Makes the Investment Decisions?

A Federal Reserve report from 2019 found that that women were less comfortable making investment decisions than men; only 32% percent of women said they were comfortable managing their investments. And, women, on average, answered a lower share of financial literacy questions correctly (52%) than men (67%).

When the 2008 financial crisis hit, many women realized they had willingly given up their financial power and that their partner or husband was not necessarily more financially savvy than they were when it came to investing, says Maddy Dychtwald, a founder of the AgeWave think tank. “Many women were determined to learn more and get actively involved in their financial decision-making.”

When they did, there was a noticeable sea change. The average age of when people became millionaires became 58.5 for women and 59.3 for men, Fidelity Investments reported. Most self-made millionaires who didn’t spend lavishly believed: “increase your wealth, cut your expenses.” Obviously, affluent grandparents did too. The less you worry about your money the more time you have to enjoy your life. After all, you worked for it. Amen to that.

Need help sorting it all out? Contact us at Hefren-Tillotson. We would be happy to help.

DISCLAIMER: Past performance does not predict future results. This report is based on data obtained from sources we believe to be reliable. Hefren-Tillotson does not, nor any other party, guarantee the accuracy or completeness of this report or make any warranties regarding results obtained from its usage. All opinions and estimates included in this report constitute the firms judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation to buy or sell the securities herein mentioned.

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