Academic journal article ABA Banking Journal

Implications of Exploding AARP Membership. (the Economy)

Academic journal article ABA Banking Journal

Implications of Exploding AARP Membership. (the Economy)

Article excerpt

IT IS ESTIMATED THAT THE U.S. population aged 50 years and older will rise from about 78 million in 2001 to over 117 million in 2021 -- a 50% increase. As a proportion of the total population, those people eligible to be members of AARP will grow from 28% now to 36% in 2021. This explosion in the potential membership of AARP holds some interesting economic implications -- everything from the composition of households' expenditures to the composition of their portfolios. Allow me to be your guide in exploring some of these implications.

As more and more of my fellow baby boomers get our AARP cards, we are likely to alter the composition of our spending away from durable goods, such as cars and furniture, toward more services. This does not mean that we aging baby boomers are going to give up driving anytime soon, just that our "fleet" of cars and SUVs is unlikely to increase. This holds true for some other types of durable goods, too. Now that we have a television set in almost every room of the house, we are likely to buy a new one only when one of the old ones goes on the fritz.

Being empty nesters now, we are not tied to the kids' schedules. We can enjoy more leisurely meals at nicer restaurants. And a few other things; here's a sampling:

"Gosh, I wish we had signed up for this concert series years ago. This continuing education course is terrific. I can hardly wait for this year's trip to Greece. The metabolism has slowed down, but not necessarily the calorie intake. So, I better join that health club. Despite my health-club workouts, my back is not what it used to be. Maybe I'll get a yard and plowing service this year. Speaking of my back, I've got some additional aches and pains now, not to mention my elevated cholesterol count. …

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