Asset rich, income poor
- Illusion of 100 trillion Yen senior market

Personal finaicial structure of Baby Boomers and seniors in figure

The population over 60 has the largest share of net financial assets (savings minus liabilities) of all households in Japan (Fig. 2-1). Home ownership rate is also highest for those over 60 (Fig. 2-2). In other words, these figures indicate that people over age over 60 own more in terms of assets than any other age group.

Fig. 2-1 Net financial assets (savings - liabilities) by age of householder

Source: Statistics Bureau, 2008 Household Survey

Fig. 2-2 Home ownership rates by age of householder

Source: Statistics Bureau, 2008 Household Survey

However, looking at annual income (Fig. 2-3), the average of elderly households is 2.961 million Yen, which is about half the average income of all households (5.804 million Yen). Moreover, the median annual income for those over age 60 is 2.29 million Yen, and there are many in the range from 1 million to 3 million Yen. In other words, Japanese elderly don’t have much in terms of income flow.

Fig. 2-3 Distribution of all households with annual incomes of elderly households (2004)

Source: Ministry of Health, "National Livelihood Survey" (2005) (the 2004 survey, a year annual income) (Note) and elderly households, or consist of only 65 years old or more, meaning the families who participated in this unmarried or under 18.

Seniors don’t consume much although they have more assets

The characteristic of the financial status of seniors is "asset rich, income poor". Therefore, they can spend significant money when it is very critical such as moving retirement homes. And thrift conscious is strong in order to enable it. Seniors’ typical consumption pattern in daily life is that they never use money in wasteful spending.

Previously, a lot of market research companies and articles in the media touted that, "the senior market is a huge market of 100 trillion Yen". This was an example of amateurs who did not know the reality of seniors’ consumption behaviors. Seniors do not always active consumers even they have a lot of assets.