Platinum Pensioners splashing out on rock star lifestyle

3.5 million Platinum Pensioners have billions to spend - but nobody wants their money

Platinum Pensioners live rock star lifestyles

The over 65 are living 'rock star lifestyles', spending an incredible £72 billion a year on the high life - backed by generous pensions and properties that have soared in value. The problem is that nobody wants their money.

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A study by ConsumerCast, found that spending among the over 65s is booming, and in 2015 made up more than 20% of all spending (up almost 3% in five years). Part of the issue is pure mathematics - because more people are over 65 nowadays. However, each individual is spending more too.

Pensioners have seen their income rise faster than that of the under-50s. This has been boosted by the triple lock, which has lifted pension rises above wage increases for some years. They also benefit from generous workplace pensions - and are possibly the last generation to enjoy generous defined benefit pensions (often final salary schemes).

More of the over 65 are working now too - since the end of the default retirement age in 2011 - so they have more disposable income to spend. They have also seen the value of their home go through the roof in recent years, and have been able to enter downsize to free up cash, or release equity.

How much equity could you release from your home?

Platinum pensioners

While a huge number of pensioners have seen their spending power increase, the top 3.4 million or so of them have been living the life of Riley. This group has risen by 40% in recent years - and now make up around 5% of the population.

These 'platinum pensioners' have an income of over £38,000 - at a time when the drains on their finances have practically dwindled to nothing - most of them have no mortgage, debts, or dependent offspring to eat into their hard-earned cash.

As a result they have almost doubled the amount they are spending on having fun in the past five years to £15.3 billion.

The amount of money spent on household goods and services has doubled to £5.2 billion, spending on alcohol and tobacco is up 85% to £3.8 billion, and the amount spent on restaurants and hotels is up 80% to £9.2 billion.

Nowhere to shop

It seems as though 2017 will be another good year for pensioners too. At the moment the triple lock will still ensure pension increases rise with prices - so pensioners dodge the Brexit bullet.

As the rest of the population is squeezed, ConsumerCast predicts that the over-50s will account for most of the growth in consumer spending. Given this booming market, it's frustrating to many older people that so few retailers cater to their tastes and needs.

Retailers aren't just ignoring older people, however, they are stuck in a Catch 22.

For shops that currently appeal to younger people, it's difficult for them to persuade older people to change their habits. There are some stores older people have always tended to favour - and M&S, B&Q Homebase and Morrisons count them as at least a quarter of their customer base. Meanwhile the likes of Waitrose and John Lewis attract older people with their service proposition. It's tricky for retailers to break into this market if they are not already trusted to deliver by older shoppers.

If stores make changes to cater for older customers, and fail to attract them, they risk alienating younger shoppers, without tapping into the richer, older market. Many, therefore, steer well clear of even trying. Some 95% of all advertising spend is aimed at consumers under the age of 35.

However, by choosing to ignore this older age group, they are alienating them even further. Young brands, run by young people, featuring young people in all their advertising and marketing, and suiting their styles to younger people, mean older people would never consider spending their cash with these firms.

Of course, this leaves them chasing an ever-poorer young demographic, while older people, with money burning a hole in their pockets, are left with a handful of stalwarts on the big street.

How we spend our pensions

How we spend our pensions