Posts Tagged ‘senior citizens’

Aging boomers may prove to be just as tight with savings

Tuesday, September 17th, 2013

Praying is free (but the incense will cost you)

Praying is free (but the incense will cost you)

The media has been all over the new figures related to seniors that were released by the Ministry of Internal Affairs and Communications to coincide with Respect for the Aged Day. To recap, the number of Japanese people over 65 increased by 1.12 million from the previous year, which marks a 0.95 percent rise.

The big news is that this brings the total number of seniors to about 32 million, or one-fourth of the entire population. This was expected since the huge cohort of baby boomers — which in Japan refers only to people born during a brief period in the late 1940s — is now passing the 65-year mark, and the projection is that seniors will make up a third of the population by 2035. To break down these portions even further, 18 percent of the population is over 70, 12 percent over 75 and 7 percent over 80.

What hasn’t been discussed as widely is the economic ramifications of these developments. In 2012 there were 5.95 million people over 65 who were still in the work force, or 9.5 percent of all workers over the age of 15. The average amount of savings — whether bank accounts, annuities or securities — of households with more than one person where the householder is at least 65 is ¥22.57 million. The average savings of all households is ¥16.64 million. Also, 16 percent of over-65 households have savings of more than ¥40 million, while only 10 percent of all households have saved that much.

The hope has been that once they retire boomers will spend their savings more readily than did previous generations, but so far that doesn’t seem to be the case. The ministry’s statistics indicate that more money is being spent by seniors who are still working. Those who aren’t working, meaning they are on fixed incomes provided by government or company pensions, are spending much less.

In either case, working or not, the seniors are not touching their savings. They are only spending their income. In the parlance of economists, they are asset rich but cash poor. The average income of an over-65 household is ¥2.96 million (that of an average household in general is ¥5.8 million), but the median income of an over-65 household is ¥2.29 million, meaning the majority of these households are within the ¥1 to ¥3 million income range, and that’s what they are living on.

A Cabinet Office survey conducted in 2011 asked seniors what the purpose of their savings was. About 62 percent said it was for sudden illnesses and future care and 20 percent said it was for “maintaining existence” in case of an unexpected financial problem. Only 5 percent said they would spend it on leisure, and a mere 1.6 percent wanted to use it for travel. It should be noted that 90 percent of these respondents owned their own homes or did not pay rent, so housing, at least, was not a primary concern. However, given the cost of private nursing homes, which charge upwards of ¥20 million just to move in, it’s perfectly reasonable to think that seniors believe they have to save for those final years. Until that sort of anxiety is addressed, it will always be difficult to get seniors to part with their savings.

Build a multifunction restroom and they will come

Wednesday, August 14th, 2013

Room to move

Room to move

The big question for retailers and restaurants in Japan is how to attract seniors, regardless of what it is you sell or serve. One nonprofit Tokyo organization called Check is advising businesses to install so-called multifunction restrooms on their premises and then advertise the fact. Multifunction restrooms are larger than standard public restrooms and can accommodate wheelchairs, and the NPO’s research has found that older people are more likely to patronize a business that has one.

According to a study reported in Tokyo Shimbun, the average family with at least one senior spends four hours and ¥10,000 when they go out shopping, but 20 percent also say they will likely stay out longer and spend more money if they know beforehand the location of multifunction restrooms. The study group extrapolated on its findings and speculated that in terms of time the family would stay out 30 to 120 minutes longer, and spend ¥606 more.

Check, which was founded in 2008, has made a list of some 50,000 multi-function rest rooms throughout Japan, which it provides on its website. The NPO thinks there are about 100,000, and it is providing this information to local governments so that they can use it to promote their areas to local seniors and older tourists.

However, it should be noted that toilets in general are becoming something of a sales promotional tool. The Tokyo Metro subway system actually has TV commercials aimed at women showing how modern and clean their public rest rooms are. Lawson was the first convenience store to declare that its restrooms could be used by the public without the obligation of buying something, since people were so grateful for the service they usually bought something anyway. Most convenience stores have followed suit. And many restaurants explain their rest room facilities on their home pages and Tabelog sites, since many women won’t patronize restaurants that don’t provide separate facilities for men and women.

Grandma got game: More elderly patronizing arcades

Wednesday, September 7th, 2011

Not-so-heavy medals

A recently released report by the Japan Productivity Center noted a steady decrease in leisure expenditures. In 2010, the Japanese public spent ¥67.97 trillion on recreation, a 2.1 percent decrease from the previous year and the second year in a row that statistic registered a deficit. Certain activities, however, have posted increases. Driving and eating out remain the most popular things people spend money on during their free time. They also spent about 1 percent more on theatrical films, tourism and amusement parks in 2010; and expenditures for activities “promoted on television” saw a 6.2 percent increase. The pastimes that contributed to the minus figure were mainly sports (except for bicycling and running) and goraku (distractions), a euphemism for what are generally considered non-constructive pleasures, such as gambling, pachinko and computer or arcade games.

Spending on goraku, in fact, was down by a whopping 4.7 percent, a reality that has prodded the arcade industry, both operators and game producers, to concentrate promotion on a demographic that they previously ignored: the elderly. As reported in this space last year, pachinko has become more popular in recent years among retired people who have nothing better to do and few opportunities for social interaction. However, the majority of older folks are on fixed incomes, and pachinko can be expensive. According to the Asahi Shimbun many are now turning to game arcades, or “game centers” in the Japanese parlance, and the arcades themselves are bending over backwards to accommodate them.

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Seniors reconnecting to retail

Tuesday, February 8th, 2011

A new term being tossed around by the media is kaimono nanmin (shopping refugees). It refers to people who have been cut off from the retail sector. Usually, it describes older people on fixed incomes living in remote areas, which over the past decade or so have become even more remote with the shuttering of traditional local retail districts (shotengai).

Shop til you drop: Shotengai in Sugamo

These shopping arcades used to be the only retail options one had in the countryside. The increased promotion of automobile use, which in turn prompted liberalization of laws related to distribution, gave rise to American-style shopping malls and the introduction of large international discount retailers into Japanese suburbs. Many family-owned businesses couldn’t compete, and those who did were eventually forced out of business by the recession or the fact that no one in the family wanted to take over the shop when the time came. In any case, the situation has left many older people who don’t have driver’s licenses, much less cars, without access to stores. According to Nihon TV, there are an estimated 6 million shopping refugees in Japan.

So far, most of the countermeasures for this problem have been formulated by retailers themselves, or retailers in association with local governments. Coop has a special delivery service for less mobile older folks, but as with many such services there’s a one-week gap between the time the order is made and when it’s delivered.

The most creative solution may be the one from 7&i Holdings, which runs the 7-11 convenience store chain and Ito Yokado supermarkets. On Feb. 4, 7-11 started a new test service in association with NTT and the UR public housing corporation. Five hundred households in Tokyo’s Meguro and Chuo Wards have been supplied with touch-screen tablet computers that they use to order food and sundries directly from 7-11, which are then delivered directly to their homes in a matter of hours. Currently, 7-11 offers delivery services on orders made via telephone or PC, but many elderly persons still don’t know how to use computers, and the tablets are considered simpler to use. All the user has to do is touch the image on the screen. Minimum orders are ¥1,000 with a ¥200 delivery charge per order. The test period will last six months.

Continue reading about elderly shoppers →

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