The world is preparing to welcome a new generational powerhouse in that of “seniors” and those considered of “retirement age.” A transition is occurring, establishing the largest projected population of retirees and senior citizens in human history. This trend can be attributed to various factors, including the reduced physical demands of many jobs today, advancements in healthcare, a greater focus on healthy living, and technological advances, which are expanding global lifespans and the median age of adults.

Dr. Joseph Coughlin, Director of the MIT AgeLab, (also keynote speaker of this year’s HJ Sims Annual Late Winter Conference), discusses the trends of aging and longevity. Drawing upon his extensive and varied experience in academia and advising global firms, Dr. Coughlin shares insight gained from his position as instructor in MIT’s Department of Urban Studies and Planning and Sloan School’s Advanced Management Program. Dr. Coughlin is also the author of The Longevity Economy: Inside the World’s Fastest Growing, Most Misunderstood Market.

Dr. Coughlin cites the leading indicators of the pattern of retirees and consequent implications for product and service providers in countries throughout the world.

• In Germany: the country is recognizing the trending population of older adults and creating an anti-aging beer
• In Japan: the sale of adult diapers has surpassed those sold for infants
• In the U.S.: an adult turns the age of 75 every seven seconds and 13% of all online dating services are being utilized by persons aged 65+ and older

With the population aging as whole, in the U.S., the baby boomers will redefine the standards of retirement. These standards are being driven by educated consumers and corporations recognizing the demand of this growing population with expectations and wants that differ markedly from prior generations. If combined into an aggregate economy, the “aging population” would create the world’s third largest driver of global spending. Furthermore, adults above the age of sixty have the highest concentration of wealth in the world, and are living longer now.

Not only are adults living longer, they are staying active. A growing majority of these aging adults are the baby boomers who grew up in a counter-culture era soaked in rebellion and quasi-revolution. Dr. Coughlin amusingly quotes the musician Jimmy Buffet describing baby boomers as, “the people our parents warned us about.” This “warning” is being increasingly heeded by consumers and producers. The stereotypical parent of a baby boomer was polite, hardworking, patient and easily appeased, explains Dr. Coughlin. These generational qualities helped shape many of the current products and services for seniors.

For context, Dr. Coughlin draws a parallel to product offerings, between the two age groups, using coffee, as an example. The current population in their mid-70’s and older most likely had two options for coffee growing-up: decaffeinated and caffeinated. The younger generation has experienced a multitude of options from which to choose: frappuccinos, lattes, espressos and even white chocolate caramel macchiatos served hot, warm, chilled and iced. “They (baby boomers] are creating a new generational gap, a gap of expectations,” exclaims Dr. Coughlin. That gap is what will drive innovation and pave the way for what Coughlin defines as the Longevity Economy.

Dr. Coughlin notes that, in fact, even the word “retirement” has changed meaning throughout time. Originated as a word to describe the stage when a person ran out of “vital life” and ability to perform physical labor, retirement meant one could no longer function as a member of the working economy and likely would result in a person falling victim to poverty. The modern definition of retirement could not be further from its root of origin. Today, people will live almost one third of their adult lives as retirees. With this extended period of time, Dr. Coughlin characterizes retirement as having four phases:

• Ambiguity: Should one keep working or not?
• Big Decisions: Does one downsize, move or travel?
• Complexity: Should decisions like housing, healthcare, etc. be  managed by a third party?
• End of life: When does one begin preparing for the final chapter of life?