People aged over 50 now exceed a third of the UK population and comprise the most affluent consumer group in terms of income and wealth but are being ignored by financial services providers, research suggests.
According to market analyst Datamonitor, a small portion of financial services providers gear their marketing materials and products towards this age group, approaching 20 million, and taking them for granted.
The research firm says in 2003 there were over 522,000 high-net-worth people aged 56 and over, representing almost 70% of the UK high-net-worth population and owning 68% of high-net-worth liquid assets, exceeding £215bn.
Karina Purang, financial services analyst at Datamonitor says: “Representing nearly 20 million of the total UK population, growing at a sustained pace and holding a bigger proportion of wealth than their younger counterparts, the over 50s represent a goldmine for financial services providers.”
Purang, author of the report, argues not all financial products need to specifically target at people aged 50 and over, as they have much in common with the whole population.
Instead, Purang highlights target areas, which might benefit providers including savings, investments and general insurance product such as household insurance.
Savings and investments are a crucial target area since customers contain the most wealth.
When it comes to household insurance, Datamonitor argues while majority of providers targeting the over 50s separate their products based on price, a better solution might be for providers to segment their senior customer base by household income band instead.
This runs on the principle that ‘affluent’ customers are more likely to have increased household insurance needs, as they generally have acquired more property assets.
Additionally, this age spectrum will also own a fair amount of overseas property, given a love of travel and holidays paired with financial affordability, Datamonitor says.IFAonline
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