Although boomers say they are likely to cut back on their monthly household budget in the coming year, survey results show that beauty could prove one of the last areas where cutbacks will be made.
Boomers hit an economic wall in 2008 as stock markets and the housing market began to slumped, affecting years of savings and nest eggs that had given the 50-plus age group the confidence to spend, a new report from the Focalyst group reveals.
However, a more detailed look at the research findings shows that the outlook is quite varied among different sub-groups within the boomer category.
Dividing boomers into three clear groups
Research work involving extensive questioning of boomers found that the group could be subdivided into three clearly defined sub categories, accorded to outlook on life and financial position.
Of those three groups, 25 percent were allocated to the Yesterday group, who feel life was better in the old days, 30 percent allocated to the Today group, who enjoy life in the present, and 45 percent belonged to the Tomorrow group, who were more optimistic about the future.
Not surprisingly, the most pessimistic group was the Yesterdays, who have been hard hit by a reduction in their spending power over the last two years.
Loss of savings causes worries
This has been caused by a loss of savings and has led to fears for their future well-being, fuelling worries that they will become a burden to their families or the state in the future.
“The last two years have not been good to the ‘Yesterday segment,” the report reveals. “They are looking back with disappointment and quiet regret while facing an uncertain future.’
The Yesterday segment currently spends around $20 on personal care out of a total monthly household budget of $314, and in this category 46 percent of those surveyed said they would not be cutting back on that spend.
Contrastingly 69 percent of people in this category said they would be cutting back on their overall monthly household budget.
In contrast to the Yesterday group, the Todays are far more positive, stating that financial planning means that they have been able to cushion the impact of the economic downturn.
Most are reasonably comfortable and are planning an indulgent retirement, in which they put their health as a priority.
Of a total household spend of $331 per month, $21 goes on personal care and toiletries products.
However, what is most interesting about this group is that, despite the fact that 39 percent of those surveyed said they would be cutting back on their household budgets, an impressive 76 percent said they would not be cutting back on their beauty spend.
Tomorrow group most positive about future
The most positive general outlook came from the Tomorrow group, who, despite financial setbacks, still remain positive about the future, even if they are experiencing a reduced spending power.
Statistically speaking, this group remains the most affluent and has the highest monthly household expenditure at $343 a month – of which $26 is spent on personal care products.
Of those surveyed, 60 percent said they were going to cut back on their household expenditure, while 50 percent said they would not be cutting back on their beauty spend.
The results suggest that, although expenditure on personal care products is likely to fall in the coming year, targeting the clearly identifiable financially more stable boomers is more likely to pay dividends.