The 24-year-olds and 40-year-olds are driving the economy right now
- The oldest millennial and the oldest of Gen Z are currently in charge – of spending, influence, and the economy.
- The 40-year-old’s financial behavior shapes huge economic markets like housing.
- Meanwhile, the 24-year-old is setting trends, affecting consumer behavior for everyone.
The 40-year-olds and 24-year-olds are talking about him at the moment.
The oldest millennial, who turns 40 this year, has the most purchasing power. Most of them have recovered from a decade-long struggle following the 2008 financial crisis, and they’re spending the biggest purchase of their lives – homes.
The oldest of Generation Z, who turns 24 this year, has more influence on consumer behavior. A decade before they replaced millennials as the biggest spenders, they are already seen as taste makers, a role each generation takes on during this stage of life.
Everything from your shopping choices to your lifestyle choices is likely shaped by the older members of these generations.
Meet the people who are shaping the world you will live in for the next ten years, if not two.
The 40-year-old millennial has purchasing power
Millennials have become the economic driving force of the United States. They are the largest generation, represent the largest percentage of the country’s workforce, and hold the greatest purchasing power.
As millennials age and their incomes increase, their purchasing power only increases. Just look at the coming millennium purchasing power wave in the graph below. The 40-year-old is leading the way.
While they were among the hardest hit by the Great
, many have made tremendous strides in wealth creation in recent years. In 2016, their wealth levels were 34% lower than they should have been, but as the economy improved and they approached their best earning years, they reduced that deficit to 11. % in 2019. The economic shutdown of the pandemic has also allowed the richest cohort to swell. away even more money.
This means that they are the ones who spend a lot on big ticket items, like housing. Most 40-year-olds have mortgages, making them the tip of the generational spear leading the pandemic housing boom. This home buying frenzy not only injects needed money into the economy, it is reshaping the real estate market. Migration to the west and to the Sunbelt has been an economic boon to major cities in the region, while the “Great American Land Rush” saw millennials take over almost all of the starting homes on the Marlet.
But there’s also something to be said for the 40-year-old millennial who can’t spend much because he hasn’t recovered financially from the Great Recession. Many are still in debt, such as student loans. The affordability crisis they face can trigger policy changes such as student debt relief, which lawmakers are currently debating.
24-year-old Gen Zer has the power to influence
As the oldest millennial entered middle age, the oldest of Gen Z became a trailblazer.
This is the stage of life where a new generation comes into the limelight because they’re old enough to begin to exert an influence, Jason Dorsey, who heads the Center for Generational Kinetics, a research firm, recently told Insider. research in Austin, Texas.
This is exactly what Gen Z has done since coming out of the pandemic as the new “it” generation. They sent mid pieces, baggy jeans and Y2K fashion to the streets and skinny jeans and side pieces to the roadside, paving the way for consumer trends.
At the center of this cultural shift was TikTok, which exploded during the pandemic. In September 2020, the social media app grew by 75%, spreading to intergenerational use and signaling the growing influence of Gen Z on the behavior of leading consumers, similar to millennials l ‘did with Instagram.
In just over a decade, Gen Z will take over the economy. Gen Z currently earns $ 7 trillion out of their cohort of 2.5 billion people, according to Bank of America Research. By 2025, that income will reach $ 17 trillion, and by 2030 it will reach $ 33 trillion, accounting for 27% of global income and surpassing that of millennials the following year.
With that kind of influence, Dorsey predicts that the generation will continue to change and lead the conversation over the next 15 years.
The world is reacting. Politicians and lawmakers debate how to tackle the economic problems plaguing millennials, while brands try to figure out how they can market to Gen Z. They already know we live in a world created by 1920s and early 1940s.