The Boomers, Generation X, Generation
What separates Generation Y from Generation X? And hello Gen Z and Gen A, welcome to the party! What is the limit? How old is each generation? Are they really that different?
It’s easy to see why there’s so much confusion about generational cohorts.
If you’ve ever been confused by this alphabet soup of names, you’re not alone.
The real frustration comes when you realize that consumers millennials they represent the generation that will spend the most in 2020, with an expected account of 1.4 trillion dollars.
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And while his current wealth has been dragged down by not one but two economic crises “once in a lifetime” During their most impactful career years, the millennials will inherit more than 68 billion dollars from the parents of the Baby Boomers and from the first generation X by the year 2030, making them the richest generation in American history.
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The Generation Z It is not far behind, projected to reach $33 trillion in income by 2030 – accounting for more than a quarter of all global income – and to surpass Millennials in purchasing power the following year. 3
And last but not least is the Alpha Generationthe name given by popular analyst Mark McCrindle to the youngest children on the planet. By the year 2025 there will be almost 2 billion members of the Alpha Generation worldwide..
Regardless of how you look at the data, the younger generation has never been more important to the future of your financial institution.
Unless you understand who they are and what they want, you won’t get a dollar of their money.
People get old.
Birthdays don’t change.
A common source of confusion when labeling generations is their age.
Generational cohorts are (loosely) defined by year of birth, not current age.
The reason is fácil: generations age in groups.
If you think about the millennials As young college students (18 – 22 years old), you are not only outdated, but you are thinking of a stage in life, not a generation.
Millennials are already out of college, and that stage of life is dominated by Generation Z.
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Another example: a member of Generation X who turned 18 in 1998 would now be in his 40s.
In that time, he or she is concerned with very different issues and is receptive to a new equipo of marketing messages.
Regardless of her age, she will always belong to the generation in which she was born.
The breakdown by age is as follows
- Baby Boomers: Baby boomers were born between 1946 and 1964.
They are currently between 57 and 75 years old (71.6 million in the United States)
- Gen X: Generation X was born between 1965 and 1979/80 and is currently between 41-56 years old (65.2 million people in the US)
- Generation Y: Generation Y, or Millennials, were born between 1981 and 1994/6.
They are currently between the ages of 25 and 40 (72.1 million people in the US)
- Gen Y.1: 25-29 years (about 31 million people in the US)
- Gen Y.2: 29-39 years (about 42 million people in the US)
- Gen Z: Gen Z is the most recent generation, born between 1997 and 2012.
They are currently between the ages of 9 and 24 (almost 68 million in the US)
- Gene A:The Alpha Generation begins with children born in 2012 and will continue until at least 2025, maybe later (approximately 48 million people in the US)
The term “Millennials” has become the habitual way of referring to both segments of Generation Y (later Y.1 and Y.2).
Sometimes they are labeled with the nickname of Zillennials those who are in the tail of Millennials and the beginning of Generation Za group made up of people born between 1994 and the year 2000.
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Originally the name of Generation Zit was a placeholder for the youngest people on the planet, though now Generation A has assumed that distinction.
However, in the same way that Generation Y became Millennials, there is a oportunidad that both Generation Z and Generation A will adopt new names as they move out of adolescence and mature into their adult identities.
Although the Gen A label makes it easy to enfrentamiento, it may not be the last word on this human group.
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Why are generations named after letters?
It started with Generation X, people born between 1965-1980.
The previous generation was that of the Baby Boomersborn between 1946 and 1964.
After World War II, Americans enjoyed a newfound prosperity, leading to a baby boomer.
The children that were born as a result were nicknamed the Baby Boomers .
But the generation that followed the Boomers did not have a clear cultural identifier.
In fact, that is the anecdotal origin of the term.
Gen X, illustrating the indeterminate characteristics by which they would come to be known.
Depending on who you ask, it was sociologists, a novelist, or Billy Idol who cemented this phrase into our vocabulary.
From there, everything was an alphabet.
The generation that followed Generation X naturally became the generation y, born between 1981 and 1996 (give or take a few years on either end).
The term “Millennials” It is attributed to Neil Howe, along with William Strauss.
Both coined the term in 1989, as the impending turn of the millennium began to figure prominently in cultural consciousness.
The Generation Z refers to babies born from the late 1990s to today. .
A flurry of would-be labels have also appeared, including Gen Tech, articulo-Millennials, iGeneration, Gen Y-Fi, and Zoomers.
While some say the Alpha Generation Named after the first letter of the Greek alphabet and denoting the first in a series of elements or categories, the Alpha Generation may also just be an easy way to flip a new alphabet.
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Dividing Generation Y
Javelin Research has observed that not all millennialsThey are currently in the same stage of life.
While all millennialsborn around the turn of the century, some of them are still in early adulthood, struggling with new careers and settling down, while older Millennials have homes and are building families.
You cánido imagine how having a child perro change your interests and priorities, so for marketing purposes, it is useful to divide this generation into Gen Y.1 and Gen Y.2 .
both groups are not only culturally different, they are in very different phases of their financial life .
The younger group has just made use of their purchasing power.
The second group has a longer history and may be refinancing their mortgage and raising their children.
The contrast between priorities and needs is stark.
The same logic cánido be applied to any generation that is at this stage of life or younger.
As we get older, we tend to become homogenized and deal with afín life problems.
The younger we are, the more dramatic each stage of life is.
Consider the difference between someone who is in elementary school and someone in high school.
Although they are from the same generation, they have very different views and needs.
Addressing the young generations as one cohort will not be as effective as segmenting your strategy and messaging.
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Why are generational cohort names important?
Each generation label serves as a shorthand for nearly 20 years of attitudes, motivations, and historical events.
Few individuals self-identify as Generation X, Millennial, or any other name.
They are useful terms for marketersand tend to become common usage.
Again, it is important to note that referring to a cohort by age range alone gets complicated quickly.
Within ten years, the priorities of the millennials they will have changed, and marketing tactics will need to be adjusted accordingly .
There are also other categories of cohorts that cánido be used to better understand consumers, beyond age or generation.
Remember that these arbitrary generational cutoffs are just that.
They are not an exact science and are continually evolving.
Whatever terminology or grouping you use, the goal is to reach people with marketing messages that are relevant to their phase of life.
In short, no matter how many letters are added to the alphabet soup, the most important thing you perro do is try to understand the soup du jour for the type of consumer you want to attract.
What makes each generation different?
Before going into each generation, remember that exact birth years are disputed, because there are no comparatively definitive thresholds by which to define subsequent generations (after the Boomers).
But this should give you a general range that helps you identify which generation you belong to.
The other fact to remember is that new technology is often first adopted by the younger generation and then gradually adopted by the older generation.
For example, 96% of Americans have a móvil, but Generation Z (the youngest) is the one who emplees it the most.
The Baby Boomer Generation
- Boomer birth years: 1946 to 1964
- Current age:57 to 75 years
- Generation Size: 71.6 million (USA)
- Media consumption: Baby boomers are the largest consumers of traditional media such as television, radio, magazines, and newspapers.
Despite being so traditional, 90% of baby boomers have a Fb account.
This generation has started to embrace more technology to keep in touch with family members and reconnect with old friends.
- Banking habits: Boomers prefer to go to a branch to carry out transactions.
This generational cohort still prefers to use cash, especially for purchases under $5.
- Determining events: Articulo-WWII optimism, the Cold War, and the hippie movement.
- What’s next on your financial horizon: This generation is experiencing the highest growth in student loan debt.
Although it may seem contradictory, it perro be explained by the fact that this generation is the one with the most wealth and seeks to help their children with their student debt.
They have the belief that children need to be cared for enough to put them on the right path and do not plan to leave any inheritance.
With more Americans outliving their retirement funds, pensions dwindling, and Popular Security in jeopardy, making sure retirement cánido be successfully financed is a top concern for Boomers.
Generation X
- Birth years of Generation X: 1965 to 1979/80
- Current age: 41 to 56 years
- Other nicknames: Generation “Latch key” MTV generation
- Generation Size: 65.2 million (USA)
- Media consumption: Generation X continues to read newspapers, magazines, listen to the radio and watch television (about 165 hours of television per month).
However, they are also digitally savvy, spending approximately 7 hours a week on Fb (the highest of any generational cohort).
- Banking habits: Being digital savvy, Gen Xers do some financial research and management en línea, but still prefer to transact in person.
They believe banking is a person-to-person business and demonstrate brand loyalty.
- Determining events: The end of the cold war, the rise of personal computing and feeling lost between the two great generations.
- What’s next on the financial horizon for Generation X: Generation X is trying to start a family, pay off student debt, and take care of their aging parents.
These demands put a huge strain on your resources.
Generation X has an average debt of $142,000, although most of it is from their mortgage.
They seek to disminuye their debt while building a stable savings plan for the future.
Millennials (Gen Y)
- Millennial birth years:1981 to 1994/6
- Current age: 25 to 40 years
- Other nicknames: Generation Y, Generation Me, Generation Us, Echo Boomers.
- Generation size: 72.1 million (USA).
- Media consumption: 95% still watch televisión, but Netflix surpasses traditional cable as the preferred provider.
Cutting the cord in favor of uso contínuo services is the most habitual option.
This generation is very comfortable with mobile devices, but 32% still use the computer to shop.
They usually have multiple accounts on popular media.
- Banking habits: Millennials have less brand loyalty than previous generations.
They prefer to buy products and features first, and have little patience with poor or inefficient service.
That’s why millennials put their trust in brands with superior product track records, like Apple and Google plus.
They look for digital tools to help them manage their debts and see their banks as transactional rather than relational.
- Determining events:The Great Recession, the technological explosion of the Internet and popular networks, and 9/11.
- What’s next on your financial horizon: Millennials are powering the workforce, but with massive amounts of student debt.
This is holding up major purchases like weddings and houses.
Due to this financial instability, millennials are choosing access over ownership, which perro be seen through their preference for a la carte services.
They want partners to guide them on their big purchases.
Gene Z
- Birth years of Generation Z: 1997 to 2012.
- Current ages: 9 to 24 years.
- Other nicknames:iGeneration, Articulo-millennials, Homeland Generation.
- Generation size: 68 million (USA).
- Media consumption:The average Gen Z received their first mobile phone at the age of 10.3.
Many of them grew up playing with their parents’ phones or tabletas.
They have grown up in a hyper-connected world and the móvil inteligente is their preferred method of communication.
On average, they spend 3 hours a day on their mobile device.
- Banking habits:This generation has seen the struggle of Millennials and has taken a more fiscally conservative approach.
They want to avoid debt and appreciate accounts or services that help them in that task.
Debit cards top their priority list, followed by mobile banking.
- Influencing events:Teléfonos inteligentes, popular networks, not knowing a country that is not at war and seeing the financial difficulties of their parents (Generation X).
- What’s next on the financial horizon for Generation Z:Learn about personal finance.
They have a great appetite for financial education and are opening savings accounts at younger ages than previous generations.
Alpha Generation (Alpha)
- Years of birth:2012 to 2025/6.
- Current age:0 to 9.
- Other nicknames:None that have stayed.
Often the nickname focuses on a defining event or characteristic.
- Generation size:48 million and growing (USA)
- Media consumption:Alphas have been raised in homes with speakers and smart devices everywhere; technology is integrated into everyday objects.
Many of them attended school virtually thanks to the global pandemic and are gravitating towards en línea learning with programs like Khan Academy, Prodigy and IXL.
Many have even had a digital presence since before they were born, with their Millennial parents creating popular media accounts for their children.
- Banking habits:Although some of the older Alphas may have accounts like Greenlight, they don’t have definite banking habits.
They are digital natives who expect fully integrated and personalized consumer experiences.
Based on current data, it appears that the Alphas will be one of the most educated and wealthy generations.
It is not clear if their banking habits will be influenced by their parents (ie, “my parents do their banking here, so do I”) or by other factors.
- Determining events:The global pandemic, the popular justice movement, Trump-era politics and Brexit.
- What’s next on the financial horizon for Generation Alpha:As digital natives viewing the world through a collection of screens, Alphas will be even more disconnected from the iniciativa of cash.
They are likely to first find the money as a number on a screen and spend it through aplicaciones and other forms of y también-commerce.
Do generations use technology differently?
Younger generations have often led older Americans in their adoption and use of technology, and this largely holds true today.
Although Baby Boomers may lag behind Generation X and Millennials in their use of native technology, the pace at which Boomers are expanding their use of technology is accelerating.
In fact, Boomers are much more likely to own a móvil than they were in 2011 (68% in 2019 vs. 25% then).
Are generations the best way to categorize consumer behavior?
Understanding generational trends is important, as they perro reveal afín attitudes and behaviors among consumers who experienced world events at the same life stage as their cohorts.
And it doesn’t hurt to know these age groups, since marketing tools and audience segmentations often include age as a aspecto.
But generations don’t tell the whole story, and their behaviors perro be hard to pin down.
After all, each generation grows.
So cánido age ranges alone be trusted? This is what we think.
Do generations bank differently?
Absolutelyand for various reasons.
Each generation has been in the workforce for different lengths of time and has accumulated different degrees of wealth.
The Baby Boomersthey have a median worth of $1,066,000 and a median worth of $224,000.
The median net worth of the generation Xis about $288,700, but the median is $59,800.
The millennialsthey have a median net worth of about $76,200, but their median net worth is only $11,100.
The median net worth of the Generation Zit’s hard to know, since so much of this generation doesn’t yet have a net worth or a professional career.
Each generation prepares and saves for different stages of life, whether it is retirement, the children’s college tuition or the purchase of the first car.
Every generation grew up evolving technological worldsand has unique preferences when it comes to managing financial relationships.
Each generation grew up in different financial climates, which has influenced their financial attitudes and their views on institutions.
However, in the last year, the COVID-19 pandemic has become the great equalizer, as all generations have had to adapt to a new way of banking and living.
How are these bank differences appearing in the market?
Ease of use vs.
Personal service.
If you think bots are taking over the world, you may be right.
But for consumers millennials and generation Z, this is not necessarily a bad thing.
In fact, according to a recent Adobe Analytics study, 44% of the Generation Zand 31% of the millennialshave used a banking chatbot to answer their questions.
And before you think that must be a horrible usuario experience, more than half of both groups that actually used a chatbot said the experience was better than talking to a real person.
However, for the most complicated banking tasks, even the younger generation prefers the plus help of a human representative.
Safety remains first, always.
But each generation has its own priorities.
When choosing a new bank, the “security”was the main concern of Generation Z, Millennials, Generation X and Boomers.
The “reputation”(also known as its brand) came in second for consumers in the Generation Z and Millennials.
However, for consumers of the Generation Z and the Boomersbranch locations were the second most habitual result, closely followed by “reputation”.
Younger consumers still care about branch location, but weigh it at the same level as an institution’s digital services and aplicación.
For Generation X, digital and aplicación services were overtaken by in-person support.
For Baby Boomers, local banking was more important.4 However, before you dismiss the importance of their en línea and mobile banking for these consumers…
Technology is no longer just for the younger generation.
The trend has long been for each new generation to more easily adopt digital and mobile banking services.
But the COVID-19 pandemic has caused a new wave of late adopters to bank digitally as well.
According to a recent Zelle survey, 82% of those 55 and older are now banking more frequently en línea, with 61% and 55% using popular media and mobile banking more frequently as well.5
This coincides with the start of the Baby Boomer demographic (currently 57-75).
And while only time will tell how lasting this shift to digital tools and services will be, the more positive your digital experience is, the more likely you are to expand your digital reach with this generation.
Today, the older generations behave more like the younger ones.
And if you want to succeed in tomorrow’s market, you already have to meet these younger generations where they are.
Now is the time to extend your great service brand beyond the branch.
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