Boom to Z – Keeping Sight of the Financial and Payment Needs of Every Generation



When discussing the latest payments research, the industry tends to focus a lot on millennials.  After all, this group of 90 million or so individuals born 1980 to 2000 is the largest demographic group today and is starting to make real waves with its spending patterns. However, while the millennial group is important, we would be remiss if we didn’t understand the characteristics of both the older and younger generations.

Predating the millennial generation, members of Generation X, those born from about 1964 to 1980, are in their prime earning years and even entering their AARP years. Taking the elder Gen Xers with their forebears – Baby Boomers – we can see the tremendous importance, both in terms of number of consumers and spendable income, of the 50 and over set.

AARP worked in conjunction with Oxford Economics on a recent white paper,   The 50-plus group plays an outsized role in the overall economy in various ways, including:  

The Longevity Economy: How People Over 50 Are Driving Economic and Social Value in the U.S.

  • While accounting for 35 percent of the population in 2015, this group was responsible for 53 percent of consumer spending
  • Spent $5.6 trillion on direct spending on goods and services in 2015
  • Holds 83 percent of U.S. household wealth


As more and more of the Gen X generation that is just now starting to hit the 50-year-old mark enters the Longevity Economy, the over-50 crowd will grow by 45 percent from now through 2050.  That's compared to only 13 percent growth among the under-50 group over that same time frame. 

Flipping to the other side of the millennials, Generation Z is roughly defined as those born in 2000 all the way to today.  This young, still growing, generation has been raised on technology while suffering through the great recession.  

Even though this generation - the oldest now only 16 - is new to the banking system, financial institutions are already studying its perceptions.  One is TD Bank, which looked at Generation Zers in its Checking Experience Index 2015.  The index found that Gen Zers are more likely than millennials to change financial institutions in two years and prefer to pay with cash for everyday purchases more than millennials.


Not forgetting our friends in the millennial generation, The Millennial Disruption Index put together by Viacom Velocity (formerly Scratch), identified banking as the industry most likely to be disrupted. The study results show the importance of, and challenge in, wooing this audience:

  • 53 percent said their bank didn’t offer anything different from other financial institutions
  • 1 in 3 indicated willingness to switch financial institution in the next 90 days
  • 33 percent think they will not need a bank at all in the not too distant future

While the over 50 cohort seeks stable financial relationships that help manage this group’s wealth and substantial buying power, the younger millennials and Generation Z consumers will be looking beyond the traditional banking relationship. 

Each generation, and even slices within each, has its own unique expectations of financial institutions, payment instruments, retailers and more. Understanding and catering to those differences will improve service relevance and create lasting competitive advantage and brand preference. 

Joel Antonini
Senior Vice President, Marketing 


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