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Spending Trends

By Amy Spiezio

When it comes to spending, age determines buying power. But, according to the U.S. Census Bureau's Consumer Spending Surveys from 2001, 2005, and 2006, consumer expenditures are on the rise for all age groups.

■ NEW SPENDERS. As the up-and-coming generation X'ers increase their expenditures, they are catching up with the young baby boomers. The difference in total annual expenditures is leveling out between the 35 to 44 category and the 45 to 54 category. In 2001, the difference was $1,022 and in 2005 (the most recent year with available age break down) the gap closed to $664.

In fact, the categories were generally led by the 35 to 44 age group, spending more in the food, housing apparel, and transportation categories.

■ AGE ADVANTAGE: The next age bracket up, 45 to 54, showed that getting older has its advantages. Thanks to lower major house-hold and transportation expenses, this group had more money to enjoy the good things in life, and they led the entertainment segment of expenditures.

The group also has a few realities to deal with, such as health and approaching retirement, which is reflected by their spending, which is the highest across the age range in both healthcare and personal insurance/pensions.

■ GROWTH AND DECLINE. The biggest jump in expenditures between 2001 and 2005 came from the the 35 to 44 age group, with an extra $8,282 average. Possibly as a result, a growing gap appeared between the the 25 to 34 year old group and the 35 to 44 year old group. In 2001, that difference was $7,475; today, it has grown to $10,122 in favor of older spenders.

Overall, there is a major spending drop between the 55 to 64 age group and the 65 and over age group. And that gap is growing. There was a $13,748 difference in 2001, and in 2005, the difference is $16,726.

The least change overall came from the 75 and over category. The least likely to spend, this group trails behind other age groups spending $27.018, more than $10,000 less than the 65 to 74 annual expenditure. EB