Gen X likes to spend. Whether it's food, entertainment, health care, or housing, they aren’t holding back. Baby boomers aren’t shy either. They are right behind their younger counterparts, but to a lesser extent.
Gen X is estimated to spend around $83,000 annually, while baby boomers are a little more frugal, spending around $62,000 annually.
But that’s where the similarities end between these two generations. What they spend on and why is different.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
“Baby boomers are spending a lot of money on travel, health care, home improvements and their grandchildren,” says Bryan Bibbo, President and CFO of JL Smith Holistic Wealth Management. “Generation X is the sandwich generation. They are still helping out their elderly parents and spending on their children."
That's not all. Here's a look at what baby boomers and Gen X are up to when it comes to spending.
What baby boomers are spending on
At this point, baby boomers are thinking about retiring, are semi-retired, retired, or are in a work optional situation. Many have been saving for retirement for years, benefiting from the more than ten-year bull run in the stock markets.
Home values have also appreciated, giving baby boomers significant equity in their homes. Pensions and Social Security also increase their spending power. Boomers ended 2024 with more than $80 trillion in wealth, according to the Federal Reserve.
They aren’t too concerned with leaving an inheritance either. About half of baby boomers said they didn’t expect to leave any inheritance when polled by Northwestern Mutual.
Spending abounds
Spending is across the board with Boomers. It's on travel, dining, entertainment and luxury items, to name a few. Health care is also a big component of their expenditures.
The more money they have, the more Boomers spend. For every $1 increase in financial wealth, Visa found Americans 65 and older spent an additional 11 cents.
What Gen Xers are spending on
Gen X is in a different position. Known as the Sandwich Generation, Gen X has to care for their parents and their children, which takes an economic and emotional toll.
Gen X faces extra costs associated with health care, childcare and elder care, making it difficult to save for retirement. It’s partly why Gen X is behind in saving for retirement.
On the positive side, they're making more money than everyone else. Gen X has the highest median income in the country. Many work at home and have flexible schedules, and see no reason to retire. That gives them a longer time horizon to save and to spend.
“For the baby boomers, it was common to get a job, grind it out for 30 or 40 years, retire at 60 or 65, collect a pension, and live on that,” says Stephanie Temporiti, a wealth advisor at Hightower Wealth Advisors. “Gen X is stretching that idea.”
Housing and debt
Gen X’s income disproportionately goes to housing. Whether it's rent or mortgages, living in America is expensive, and Gen X is feeling the brunt of it.
The generation has more debt than any other age group, largely because they're stuck in the middle.
“Gen X investors told us they are taking on large levels of debt to manage caregiving responsibilities,” says Craig Hawley, President of Nationwide Annuity. “Additionally, to meet these financial commitments, a quarter of Gen X investors are taking on credit card debt.”
Despite the challenges, Gen X makes room to spend on everything from travel to electronics. And that isn’t expected to change for a while.
Gen X, which is in its peak earning phase, ended the fourth quarter with $41.67 trillion in wealth. It is also poised to get richer as part of what Cerulli Associates says will be $124 trillion in wealth transferred through 2048. Much of it will come from baby boomers.
More of the same
Baby boomers and Gen X may not agree on everything, but when it comes to spending money, they are more alike than different.
Whether they are using their income for gadgets or travel, these two generations have money, and they aren’t afraid to use it.
Related content
-
IRS 1099-K Threshold for 2025 Taxes Just Changed: What to Know NowTax Law After years of uncertainty and changing requirements, the 1099-K reporting rules for 2025 are now set, and the thresholds have changed since last year.
-
The 'Permission to Spend' Rules of Retirement SpendingHere’s how to spend guilt-free when you are in retirement.
-
The 'Permission to Spend' Rules of Retirement Spending
Here’s how to spend guilt-free when you are in retirement.
-
Major Insurers Scale Back Medicare Advantage and Part D Plans for 2026Beneficiaries enrolled in Medicare Advantage and Part D prescription drug plans might be losing their plan as UnitedHealthcare, Humana, and Aetna (CVS Health) scale back offerings for 2026.
-
I Want to Retire, but I Have to Keep Working so My Adult Kids Have InsuranceIt's a tricky period when your adult child is under 26 but needs health insurance. We ask financial experts for advice.
-
Preferred Bank Stocks: The Investment Retirees (and Others) May Be Missing Out OnMost large banks issue preferred stocks that pay out fixed dividends, often with higher yields than bonds. Should you make room for them in your portfolio?
-
Don't Let Your Equity Compensation Trip You Up: A Financial Expert's GuideStock options, RSUs and other executive perks can come with some serious strings attached. To avoid a nasty tax surprise, you need a plan.
-
I Work From Home, and These Are the Best Home Office Upgrades From October Prime Day and Anti-Prime Day SalesSpruce up your office for less with these sales. You could also qualify for tax credits with some upgrades.
-
6 Steps to Protect Your Retirement SavingsDon't let a shaky economy and volatile market derail your retirement. These moves will help ensure your money lasts as long as you do.
-
You're High-Net-Worth: Should Your Retirement Savings Be in a Swiss Bank?Swiss banks have long been a haven for the wealthy. Here's how to safeguard your retirement account in a Swiss bank — and whether you should.
