At the start of the year, US consumers maintained a positive outlook on the economy, but spending expectations varied across demographic groups, according to Senior Partner Becca Coggins and her coauthors. In McKinsey’s recent ConsumerWise survey, each generation showed distinct intentions to splurge, whether to make an expensive purchase or treat themselves. Only 20 percent of baby boomers, regardless of income, said they were likely to splurge. In contrast, about half of millennials expressed an intention to splurge.
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A bar chart displays the percentage of respondents intending to splurge, categorized by demographic (Gen Z, millennials, Gen X, baby boomers) and income level (all incomes, low income, medium income, high income). Also shown for each is the percentage-point difference since Q4 2024. For all income levels, the average respondent shows 39% intending to splurge, with a neutral change since Q4 2024. Low-income respondents show 38%, also with neutral change. Medium income shows 40%, with neutral change, and high income shows 39%, also with neutral change.
Gen Z overall shows a significantly higher percentage of respondents intending to splurge compared with other demographics. Across income levels, Gen Z reports 59% (all incomes, –1-percentage-point change from Q4 2024), 53% (low income, +1-percentage-point change), 62% (medium income, –3 percentage points), and 66% (high income, –1 percentage point).
Millennials show the second-highest percentage intending to splurge, with 53% (all incomes, +3 percentage points), 48% (low income, +1 percentage point), 49% (medium income, +1 percentage point), and 63% (high income, +8 percentage points).
Gen X shows a lower percentage intending to splurge than millennials and Gen Z, with 35% across all income levels, +1 percentage point; low income, +2 percentage points; medium income, +2 percentage points; and a neutral change for high income.
Baby boomers show the lowest percentage intending to splurge, with 20% overall (–4 percentage points), 16% (low income, –8 percentage points), 18% (medium income, –3 percentage points), and 23% (high income, –2 percentage points).
Note: This image description was completed with the assistance of Writer, a gen AI tool.
Source: McKinsey ConsumerWise Global Sentiment Survey, Feb 2025, n = 4,000.
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To read the article, see “An update on US consumer sentiment: Is growing uncertainty casting a chill on spending plans?,” February 28, 2025.