The CES: Tracking Generational Behavior

Welcome to part 2 of our Next Generation blog series. In this post we’ll share a little bit about the Consumer Expenditures survey, a survey that tracks the spending behaviors of consumer units across the U.S.

One of the more recent additions to the CES report is the inclusion of “expenditures by age of reference person,” which means how much different age groups spend in key consumer spending segments. Want to know how much 25-34 year-olds spend on cereals and bakery products? The CES data has you covered.

But you’re a credit union leader. You’re probably more interested in where these demographics spend money in categories like mortgages and cars. Again, the CES has you covered.

So what does the CES say? Let’s start with mortgages. Based on the headlines, you might assume that the 25-34s don’t own homes, but as we mentioned in part one of this series, the anecdotal data trends suggest otherwise. With regard to the CES specifically, this age range owns homes at a clip of 41%, with 33% leveraging mortgage loans.

Does your credit union offer mortgage loans? According to CES data, you could assume your marketplace for mortgage loans amongst 25-34 year-old members is roughly 33% of the total population. If you don’t have that much, then you’re missing out. Oh, and don’t forget about your under 25s. They own homes at a rate of 13% with 8% mortgaged.     

How about cars? Aren’t these young folks Uber-ing and Lyft-ing everywhere? Maybe, but 89% also own at least one vehicle according to the survey. Sounds like a market to me – as does the 66% of under 25s that own cars.

What’s our point here? Those that say the auto loan marketplace, or the mortgage marketplace, or any other marketplace for the next generation of members is dead may just be trying to convince you that it is – only so they can get the business for themselves. Something to think about.

Tom 

P.S: Want to grab a copy of the most recent CES generational survey data? Here is is.

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