For years, television advertisers have targeted what they call the “key demo” – people between the ages of 18 and 49. But when Credit Suisse set out to determine which demographic actually spends the most money, it turned out to be the silver-haired set. In the G6 — France, Germany, Italy, Japan, the U.K. and the U.S. — consumers over the age of 50 account for the majority of consumer spending.
The result isn’t entirely surprising, as unemployment is relatively high among young people the world over. In the U.S., they’re often loaded down with student debt, too. Net wealth, meanwhile, peaks in the 55-to-64 age bracket, an age at which many people have finished raising families and are paying down big debts such as mortgages.
Thus, older people tend to have a larger pile of disposable cash than their younger counterparts. The 50-plus age bracket accounts for 58.1 percent of total spending in Germany, 54.2 percent in the U.S. and 59.7 percent in Germany. And don’t make any assumptions about what this “key demo” buys – their consumption of goods normally associated with youth—such as video games – is on the rise. (May 2015)
Global Energy Subsidies Exceed Health Spending
Governments spend more on energy subsidies than they do on healthcare. That’s the conclusion of an IMF report released this month, which estimates the global cost of energy subsidies will be $5.3 trillion in 2015, or 6.5 percent of the world’s GDP.
Government health spending, by contrast, is expected to total just 6 percent of GDP. Mind you, the report defined the “total costs” of energy subsidies more expansively than usual combining both the government measures that keep consumer energy prices below market levels and the costs of damage to people and the environment caused by energy consumption, such as the negative health effects of air pollution and traffic congestion.
Eliminating energy subsidies completely would boost government revenue by $2.9 trillion, the study claims. Those resources, write IMF directors Benedict Clements and Vitor Gaspar, “could be used to meet critical public spending needs or reduce taxes that are choking economic growth.” (May 2015)