Aging should change the consumption of Brazilian families by 2060

The aging of the Brazilian population is expected to change the way families spend their money in the coming decades. The conclusion is from a study by FecomercioSP published at the end of October, according to a report by Times Brasil, which projects consumption behavior until 2060.

The most striking numbers are in health. By 2060, family spending on medical insurance and care could increase by around 190%. Spending on housing is expected to rise by close to 130%, and on education, around 44%. In total, family consumption could more than double, with an increase of approximately 108% in the period.

The account is based on a central assumption: each age group maintains its current consumption habits, and what changes is the weight of each group in the population. The expenditure patterns used in the study separate households by the age of who heads them and come from POF 2017-2018, an IBGE survey. These values are then projected onto the number of families estimated for 2060.

In practice, the exercise points to a direction rather than an exact value. As the pattern for each age group is maintained, the variation in total consumption depends on the change in the composition of families by age. What is at stake is how much of the family budget will be allocated to health, housing and education.

There is one limitation that the reader should keep in mind. The database is the 2017-2018 POF, and the model does not address changes in consumption habits. This makes the work a scenario, not a closed prediction.

For those who follow public accounts, the prevailing view is that the demand for health and services tends to grow with aging. This movement makes the topic relevant to any debate about the size and efficiency of the State.

What changes for the investor

For those who invest in the stock market, the message is a long horizon. If the projection is confirmed, sectors linked to health, housing and education could gain weight in family demand, which is of interest to health plan and service companies, developers and educational institutions. The effect, however, spreads over decades and rarely appears in a single quarterly balance sheet. As the study assumes constant habits, changes in price, income or behavior can alter the design of this demand. The study does not allow estimating quotes or stock performance, and the appropriate reading is to treat it as a trend to follow.

Automatically translated from Portuguese.