After hitting 55 years old, Mr. and Mrs. CU Member are thinkingabout that retirement around the corner. They have recently paidoff their mortgage and celebrated with a mortgage burning party.They have also paid off all of the other modest debts they ran upduring their productive years. Their kids are out of the house andon their own. Mr. Member has a generous pension to start drawing onin a few years. The pension and Social Security will allow them tolive out their golden years comfortably.

Well, wake up, Mr. and Mrs. CU Member. It’s not the ’70sanymore. That fantasy life of the older crowd is a vague dream ofthe past. The pension, paid-off home, no debt and children out ofthe house is a world that did exist for a lot of people in thedecades leading up to the ’80s, but that is not reality for most inthe 2010s.

Yet that fantasy existence for the older crowd has hung aroundfar too long in the thinking credit union gurus and demographicexperts. Since joining the credit union industry in 1998, I haveheard from every corner of the credit union universe about the needfor credit unions to get younger. According to experts, the averageage of credit union members is much above that of banks. The urgingto get younger seems to make a lot of sense on the surface. Youngermembers, in demographic theory, are in their borrowing prime andincome growing phase of life. They are buying or have bought theirfirst homes, trade cars often and travel. That’s the fantasy lifeof the younger crowd that still drives demographic thinking.

The real world for the younger crowd is much different. Theyounger crowd is continuing to struggle to find jobs in a tepideconomy. Many have had to return home after graduating fromcollege. Many of those who did find jobs have found jobs in fieldsnot related to their majors unless they majored in baristatechnology. The one area they have met expectations is inborrowing. Unfortunately, the debt they accumulated was fromstudent loans, which is now a $1 trillion albatross around thenecks of graduates.

Now back to Mr. and Mrs. Member of the 2010s. Private pensionswent the way of the doo-doo bird and were replaced by 401ks in the1990s. Those 401ks were then rocked by two 50% stock marketcorrections. Mr. and Mrs. Member got caught up in the housing ATMmania and took one or more cash-out refis, extending the timing ofthat mortgage burning party until they are in their 90s. Retirementat 55 was once the reality for many. Not anymore.

Despite the hits, the older crowd is also still in control ofthe money. A few months ago in an Esquire magazine article titled,“The War Against Youth” was published. The boomers really took iton the chin in this one. The children of the Greatest Generationcame off as the Greediest Generation. (Being a boomer, I think Iresent that.) But that’s not the point I took away from thisarticle. There were a number of statistics regarding incomes, debtand life plans showing how difficult things are now for thechildren of boomers than for the boomers at the same ages. Let megive you the one statistic that jumped out at me. The average networth of the 65 and over crowd in 1984 was $120,000, while the 35and younger group worth was $11,500. At the end of 2009, the networth of the 65-plus group was $170,500, while the under 35 set’saverage net worth was $3,600.

I’m not suggesting credit unions should abandon the youthmovement, but the numbers tell us that perhaps the prime market nowis not the youth market but the market credit unions already have.Credit unions tend to equate technology with youth. Hate to tellyou this, but seniors are catching on to this whole technologything. Technological advances are important to all members. Butwhat other strategies are you employing and what target market areyou focused on? Ask any branding or marketing specialist what isthe best way to build a brand and they will tell you word of mouth.Your best ambassadors for your brand just might be the members youalready have. They might not tweet your praises. but they will telltheir friends and family.

It’s clear that some perceptions about the outcomes ofdemographics are no longer valid. The younger generation is facingheadwinds that are changing behaviors and expectations. But theolder generation has changed, too. Sixty-five might be the newforty-five–or at least fifty-five. We’re living longer, workinglonger and borrowing for houses and cars later in life than everbefore. Maybe credit unions need to seriously review their productand service offerings and strategic plans. Are you over-planningfor youth? Most credit unions seem to think they know what youngermembers want, but how much time do you spend thinking what yourolder members would value most?  

Dwight Johnston is chief economist at the California and NevadaCredit Union Leagues.
Contact 909-215-3657 or [email protected]