Consumer spending among Americans aged 55 and over fell in 2015 and 2016, according to a recent report by the JPMorgan Chase Institute, which may not bode well for the U.S. economy if the trend continues. That’s according to MarketWatch retirement columnist Steve Vernon in his latest column, The downside of seniors spending less to save more.
While it makes sense that retirees living on fixed incomes would want to spend less, wrote Vernon, 20 percent of the U.S. population will be 65 or older by 2030 and this age bracket generally has more money to spend compared to younger consumers.
Spending at restaurants declined the fastest for this older age group, along with transportation, which includes public transport and automotive spending.
“These trends bear watching for older workers and retirees,” wrote Vernon. “Some economists blame reduced economic activity among seniors as the cause of Japan’s stagnant economy, although Japan is aging at a much faster rate than the U.S.”