Senior Savvy
Nevertheless, Chinese dama was the most remarkable group among investors worldwide. What drove these retirees to pour their money into gold with such enthusiasm? First, in traditional Chinese concepts gold is deemed a treasure that will never devalue. Past or present, gold has always been the most ideal heirloom to pass down to later generations. The most recent decade-long gold bull market has especially increased investor confidence. Gold bars, coins and even jewelry, which are not highly regarded by professional investors, are all considered as ideal by the Chinese general public. Second, gold is a must for bride price and dowry in Chinese marriage customs. The dama’s conviction that gold articles make perfect gifts for their daughters or daughters-in-law also stirred their spending sprees. They therefore saw the fall in gold prices as an opportunity to snap up underpriced assets.
The dama’s gold fever comes from the strong growth in disposable income of Chinese families. China’s GDP was around RMB 10 trillion in 2000, and climbed to nearly RMB 57 trillion in 2013. Annual disposable income per capita in cities surged from RMB 6,000 to RMB 27,000 over this period. With extra spare cash in their hands and growing inflation pressure, Chinese people are looking for more investment channels to retain and increase the value of their assets.
In most Chinese families wives hold the purse strings, and are sensitive to price fluctuations. They become more pennywise with age, particularly when approaching or reaching retirement, which usually entails lower incomes. In recent years, bank interest rates often fall behind the growth rate in commodity prices. A sluggish stock market has incurred losses to most smaller investors. And investment in real estate now carries higher risks and lower returns, as the market is subject to more regulations. A limited number of investment channels and precarious economic circumstances are pushing people to look for other investment products. As an acknowledged hard currency, gold appears a safer investment. It is natural that underpriced gold products have attracted high amounts of spare cash. Behind the craze for gold, however, is what Chinese dama are actually seeking – a future with a sense of security.
Dama are also making inroads into other markets like overseas real estate and bitcoins. At the 2014 Beijing Spring Real Estate Trade Fair, which kicked off in April, dama again showed their strong purchasing power. They favored real estate with a pleasant natural environment in China, as well as projects abroad. Today, many elderly middle class Chinese are fond of traveling. On such trips, they are attracted by the benign climate and environment in southern provinces like Hainan and Yunnan, where housing prices are way lower than those in such metropolises as Beijing, Shanghai and Guangzhou. Owning real estate in these areas would give them a vacation home and a safe investment, for the local housing market is not overheated as in bigger cities.
At the trade fair, the exhibition stalls of overseas projects were also crowded with dama. An exhibitor from California was impressed that four elder Chinese women jointly spent more than US $500,000 on buying a villa in the U.S., and planned to live there together. Furthermore, tours organized by Chinese travel agencies to explore real estate projects on South Korea’s Jeju Island have attracted large numbers of dama.
On top of that, more enterprising dama are venturing into antique collecting and even emerging Internet financing like bitcoin and P2P.
Dreams Come True
Most Chinese in their 50s and older lived their younger years in austerity, and saw their dreams nipped in the bud by financial difficulties. Now many of them, particularly among city dwellers, sit on big savings and have a stable income. While some endeavor to invest so as to guarantee a better later life, others are spending the spare cash on what they could not afford before.
Mrs. Bao, 63 years old, takes at least one overseas trip with her husband each year. To date, the couple has traveled to dozens of countries in Europe, the Americas and Australia. “I’ve always dreamed of seeing the world,” Mrs. Bao says, “but before, my job and family took most of my time. Now that my daughter has grown up and I’ve retired, my time finally belongs to me.”
Sixty-year-old Mrs. Du signed up for a Chinese painting course at an adult college as soon as she retired. She yearned to learn art as a little girl, but never received any formal education in it due to lack of resources and opportunities. It was not until she entered adult college that she could fully demonstrate her talent for painting. Mrs. Du is very proud that her works are often exhibited in the school as examples. “My dream is now achieved. Besides that, I’ve also made lots of friends through painting,” Mrs. Du said.
The stories of Bao and Du embody the changing lifestyles and life philosophies of Chinese dama. The pair are of the generation of women who started work after the founding of the PRC and for the first time in Chinese history enjoyed equal rights as men. They earned a salary and shared the responsibility of supporting their families. In most Chinese families, it is the wife who has a bigger say in family affairs such as a child’s education and household expenditure. With greater exposure to the bigger world through their careers, this generation of women has their own social networks and diverse channels to get information. Being vigorously involved in social activities, they keep pace with a changing society and have the guts to do new things. This trait is not lost in their twilight years. Instead, when they have more time at their disposal and their children have left home, dama long for a richer life.
As they realize their self-worth, Chinese dama make earnest effort also to give back to society. At the Lanqing Community in Dalian, a team of dama, with an average age of 76, volunteer to visit local empty-nesters and elders in tense relationships with family members or neighbors. They listen to their grievances and offer counseling. While helping others, these dama volunteers find new meaning in life and are rewarded with respect and support from society. Team leader Xu Zhiying explains their contribution as, “delighting others while pleasing ourselves.”
Xu’s comments are echoed by a good number of Chinese dama. In almost all communities there are warmhearted dama who voluntarily help clean up public areas and engage in charitable activities.
To Chinese people, dama is an affectionate term, as they are always considered the most hospitable and trustworthy of people. Now they emerge as a new class of consumers and investors that businesses in and out of China cannot overlook.
