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View Full Version : Changes from baby boomers aging beyond SS


moldmonkey
07-22-2011, 01:02 AM
Recent news and a certain Pit thread have made me think about changes in the world caused by the baby boom generation leaving the work force, besides just the costs of the social programs they will be starting to use. Talk about Social Security problems has been ongoing for as long as I can remember (41 tomorrow) but I have seen few other predictions regarding any other effects.

Will unemployment come down as boomers start retiring en mass? Will this be enough to offset our current unemployment issues? I know manufacturing is already worried about loosing most of their skilled labor. Not much fresh blood has been added because manufacturing has been doing more, with fewer people, for a long time. This will be good for me as long as I remain a machinist but will be bad if I ever make the transition to shop owner like I would like to you.

How about the effect of all these newly retired starting to draw down their retirement savings? I recall reading that this very large group of people is the wealthiest in history. Even if they donít spend it all, it will be redistributed in the next decades. There will be more cash circulating but less invested. Will the economy revive but stocks go down? The medical field will do well but what other industries will benefit? I predict Harley-Davidson will have trouble as the majority of their riders become unable to ride anymore and flood the market with used bikes. :)

I can see changes in real estate as people change their lifestyle, downsize, or are less capable. There will be increased demand for apartments/condos, maintenance-free housing, & city-center living. The typical suburban house market may continue to stagnate.

Big changes are coming. What is The Straight Dope on what they will be?

ITR champion
07-23-2011, 02:15 AM
I've seen estimates that as the Boomers pull their money out of their retirement accounts, the outflow of money will cause stock market growth to lessen by one percent on average. Then again I've seen quite a lot of estimates over the years that turned out to be completely screwy, and given the economy's state right now, crisis overseas, and the Republicans apparently desiring a default, I don't know how accurate anyone can be in their predictions for the coming decades.

Zoe
07-24-2011, 05:38 AM
I was under the impression that Boomers were not doing as well financially as their parents had done. I could be mistaken.

Social Security has had a lot of money coming in from the Boomers. So much so that it has been lent out to other places that have needed the money. Provided that money is paid back, SS should be solvent for the next 27 years. I have heard this from several sources, but I don't have a cite.

I predict more retirement communities where the aging can go from their own homes in that community to assisted living and from there to nursing care and even medical care and rehabilitation -- all within the same little neighborhood controlled by one corporation. We are seeing these already with earlier entrance ages, golf courses, tennis courses, lakes for fishing, hiking trails, bridge clubs, and so forth. It's fun to think what the hipsters may come up with.

One of my friend's mothers in her ninties was using power tools recently. I just love it!

monstro
07-24-2011, 08:54 AM
I foresee an increase in legal and illegal immigration as Baby Boomers become more dependent on home care.

fumster
07-25-2011, 01:21 AM
Social Security has had a lot of money coming in from the Boomers. So much so that it has been lent out to other places that have needed the money. Another way to say that is "invested". SS invested in what it thought were the safest securities. The trustees are not trying to do the US a favor by lending it money.

elfkin477
07-25-2011, 04:05 PM
I was under the impression that Boomers were not doing as well financially as their parents had done. I could be mistaken.Gen X (http://en.wikipedia.org/wiki/Generation_X#In_the_United_States) is the first generation to make less than their parents (men vs their fathers specifically), but I suppose they could have taken the brunt of the stockmarket hit in 2007/8 which would reduce them despite earning more than their parents over their lives.

moldmonkey, one of the supposed reasons that Gen-X is struggling financially is precisely because Boomers are not retiring en mass the way they were predicted to; heck when I was in college getting my English Education degree we were told that 60% of teachers would retire by now (2010, actually) and it hasn't happened.

The whys are fairly obvious: not only are people less "used up" by retirement age due to better lifetime health and most doing less heavy work, a whole lot of them saw a great deal of their retirement savings drift away with the recession. If you don't know if you can make it on SS and you're still physically able to work, why wouldn't you?

Wesley Clark
07-25-2011, 06:08 PM
I foresee an increase in legal and illegal immigration as Baby Boomers become more dependent on home care.

I forsee an increase in legal emigration as millennials realize many of us can't hope for more than dead end, low paying, benefit free temp jobs in the US because all the good paying full time jobs with benefits are monopolized by Gen Xers and Boomers who aren't giving them up (not that I blame them, but there aren't enough good jobs to go around in the US anymore and you have to hold onto what you have, esp in this economy).

monstro
07-25-2011, 06:57 PM
I forsee an increase in legal emigration as millennials realize many of us can't hope for more than dead end, low paying, benefit free temp jobs in the US because all the good paying full time jobs with benefits are monopolized by Gen Xers and Boomers who aren't giving them up (not that I blame them, but there aren't enough good jobs to go around in the US anymore and you have to hold onto what you have, esp in this economy).

You want Gen Xers to retire? I mean, I understand the resentment towards Boomers (lord knows I work with some that needed to go out to pasture a long time ago), but folks in their 30s and 40s? We've got another 25, 35 years before we can even dream of retirement. We're almost like you. So don't hold your breath waiting for us to go anywhere.

Perhaps you mean the Generation Jones's? Folks like my aunt, who are age 45-55. These folks either sprang out late from the Greatest Generation (like my mother's sister...separated by 17 years), or their parents were born right after the depression, so weren't able to contribute to the post-war "boom". Or their parents were back-end Baby Boomers who had children when they were relatively young (like most of my cousins). These are the folks who, after the Boomers have retired, will shift into management positions and hunker down for another ten years or so. My boss is in this demographic, but he's fat-pocketed enough so that he can start talking about retirement in the next few years. But most of the coworkers at my level are also in this set, and they are not going anywhere because some of them still have kids living under their roofs, and many are scrambling trying to keep the other ones they have in college. The number of Xers in my office is small compared to this group. So redirect your ire towards them, not us. :)

Wesley Clark
07-25-2011, 07:15 PM
You want Gen Xers to retire? I mean, I understand the resentment towards Boomers (lord knows I work with some that needed to go out to pasture a long time ago), but folks in their 30s and 40s? We've got another 25, 35 years before we can even dream of retirement. We're almost like you. So don't hold your breath waiting for us to go anywhere.

Perhaps you mean the Generation Jones's? Folks like my aunt, who are age 45-55. These folks either sprang out late from the Greatest Generation (like my mother's sister...separated by 17 years), or their parents were born right after the depression, so weren't able to contribute to the post-war "boom". Or their parents were back-end Baby Boomers who had children when they were relatively young (like most of my cousins). These are the folks who, after the Boomers have retired, will shift into management positions and hunker down for another ten years or so. My boss is in this demographic, but he's fat-pocketed enough so that he can start talking about retirement in the next few years. But most of the coworkers at my level are also in this set, and they are not going anywhere because some of them still have kids living under their roofs, and many are scrambling trying to keep the other ones they have in college. The number of Xers in my office is small compared to this group. So redirect your ire towards them, not us. :)

Like I said, I can't blame them and it isn't anger at other people so much as just a statement of fact about the economic trajectory I think the country will be under for a while, the fact that since there are only so many decent jobs to go around the ones who have already got them are going to keep them (which I can understand). People aren't going to retire before they are ready, nor should they. But with the global economic recession the boomers are having to recoup their losses from the housing collapse and stock market collapse (I think the stock market has mostly rebounded but a lot lost 6 figures in equity in the housing collapse). Combine that with the fact that most have less than 50k saved up and that there is endless talk about changing programs like SS and medicare (increasing insecurity), and I don't see a lot of good jobs opening up for young people joining the workforce since older people aren't secure enough or old enough to retire. I am resentful that the economy has become a game of musical chairs and there seem to be fewer and fewer chairs as time passes but the number of people playing stays the same or goes up.

Even in this 'recovery', most jobs created are part time temp jobs that pay roughly 20k a year. Full time jobs with benefits that pay 60k+ a year are becoming rarer and rarer. So I think more and more young people will have to emigrate, assuming they can find a country with a better standard of living.

And it isn't just jobs here that can lead to emigration. I think our health care system with its denying people care once they file a claim and 10-30% a year compounding premium increases and (to some people at least) our broken political system which keeps moving further into naked plutocracy, stalemate and anti-intellectualism make emigration seem appealing. Someone I knew growing up lives in a foreign nation, she could live here and find a job, but she doesn't trust the health care system to take care of her if she needs it. She doesn't want to lose everything she has worked for because she gets sick, so she moved to a country where that isn't a problem.

So you combine the lack of good jobs and the shoddy health care, combined with the fact that a lot of middle income countries are starting to rise up and see 5-8% economic growth year after year and there are incentives to emigrate.

Yllaria
07-25-2011, 08:35 PM
. . . Perhaps you mean the Generation Jones's? Folks like my aunt, who are age 45-55. These folks either sprang out late from the Greatest Generation (like my mother's sister...separated by 17 years), or their parents were born right after the depression, so weren't able to contribute to the post-war "boom". Or their parents were back-end Baby Boomers who had children when they were relatively young . . . )

As someone who's 55, I've always considered myself to be at the end of the boom. Perhaps it was a local abberration. We got to watch our older cousins getting hell for dressing that way and acting like those people, sure. And we missed the draft, I think. But our class was always half of the school population in junior high and high school (3 years/classes for each).

Fewer before us and fewer after. Always sounded like the apex of the pig in the python to me. Do your parents have to have been adults in WW2 for you to be a boomer? My Dad was 15 when it ended, and he was always sad that he missed it. His allegience was definitely to that era.

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As a slight aside, are there any other boomers or late-boomers out there who have kids that keep saying that you're going to come live with them when you get old? (The word they use is 'welcome', but the tone is that they'll disapprove of wasting money doing something else.) This happens every time that I talk about trying to get long term care insurance or maybe needing to move to a condo at some point.

I know that my Great-Grandma had a room at each of her daughters' houses, and she'd switch off between them every few months. Are we experiencing or about to experience a shift back to more multi-generational families? And no, none of them need a baby sitter.

monstro
07-25-2011, 10:20 PM
As someone who's 55, I've always considered myself to be at the end of the boom.

According to Wikipedia (http://en.wikipedia.org/wiki/Baby_boomer), you're technically not a Boomer. But I say, if you feel like a Boomer, let your Boomer flag fly.

My mother was born in '48. She raved over Smoky Robinson and tried to be like the Supremes, sported an fro and mini-skirt in college, where she had her first experience with a white person her own age (resulting in fear-induced diarrhea on the first day of school. HA!) Majored in sociology like probably half the student body and was all about power to the people and stuff. Wanted to be like Cher in the 70s with the long flowing hair. Grew into a workaholic, juggling-home-and-career Claire Huxtable wannabe.

Her baby sister---a change-of-life baby for her mother, lemme tell you--was born in '65. She had a TOTALLY different experience growing up. Smoky Robinson? Ha! She was all about the Jackson Five and Hong Kong Fuey. She never rocked a 'fro, but a jheri curl. She didn't go to college, but went to the Army where she could be all she could be. I don't know how familiar she was with white people, but it's not like she'd seen half the things my mother saw growing up in racist Indiana. Grew up to be a helicopter, over-protective, my-mother's-kid kind of mother.

She's much more similar to my older sister, who's four years younger than she is, than she is to my mother. The two of them grew up in totally different worlds. I don't even really think of her as my aunt, 'cuz my other aunts are OLD! :)

My sister is eight years older than me. She's solidly Gen X. By all definitions, including my own, I am as well. We didn't grow up exactly the same way, but there was enough overlap in our experiences that I wouldn't say our worlds were that different. But tack on another ten years between us? I don't think I could say the same.

Yllaria
07-27-2011, 02:32 AM
But that article says:

The United States Census Bureau considers a baby boomer to be someone born during the demographic birth boom between 1946 and 1964, including 1964.

I fit into that. From the graph, it looks like my year was one of the peaks. There was a higher peak in about '47-8.

I was kind of surprised to see that the birth rate was higher before 1920 than it was in the boom. It makes sense, though.

Thanks for sharing the changes in the generations of your family. I think my family's a lot duller. We have a tendency not to keep up with the latest thing.

moldmonkey
07-27-2011, 07:50 PM
I had assumed with the stock market coming back better than the economy as a whole that boomer retirement accounts would be looking better. This study shows the average 401k balance has gone up over the long term.

http://www.ebri.org/publications/ib/index.cfm?fa=ibDisp&content_id=4707


The average 401(k) account balance moved up and down with stock market performance, but over the entire six-year time period increased at an average annual growth rate of 10.5 percent, attaining $109,723 at year-end 2009

But confidence has not:

http://www.ebri.org/pdf/surveys/rcs/2011/FS1_RCS11_Confidence_FINAL1.pdf

Some more interesting info from that website:

http://www.ebri.org/surveys/rcs/2011/

EvilTOJ
07-28-2011, 05:38 AM
As a slight aside, are there any other boomers or late-boomers out there who have kids that keep saying that you're going to come live with them when you get old? (The word they use is 'welcome', but the tone is that they'll disapprove of wasting money doing something else.) This happens every time that I talk about trying to get long term care insurance or maybe needing to move to a condo at some point.

I know that my Great-Grandma had a room at each of her daughters' houses, and she'd switch off between them every few months. Are we experiencing or about to experience a shift back to more multi-generational families? And no, none of them need a baby sitter.

My mom is your age, and after the rash of crap my grandparents have put her and my uncle through trying to get them into retirement home care, she's told me when she gets old she's going into a home and never ever living with me. She grew up with her grandma at home and it was .... stressful. She's mentioned that other folks her age have had similar problems with their parents acting like spoiled brats and wanting everything their way even though they're in their 90's and should know better.

Voyager
07-28-2011, 12:10 PM
-------------
As a slight aside, are there any other boomers or late-boomers out there who have kids that keep saying that you're going to come live with them when you get old? (The word they use is 'welcome', but the tone is that they'll disapprove of wasting money doing something else.) This happens every time that I talk about trying to get long term care insurance or maybe needing to move to a condo at some point.

I know that my Great-Grandma had a room at each of her daughters' houses, and she'd switch off between them every few months. Are we experiencing or about to experience a shift back to more multi-generational families? And no, none of them need a baby sitter.

I was born in 1951, and hell no. We wouldn't want to move in with them, and I doubt they'd really want to have us. Somewhat near, perhaps, but with them, no. They have both done well enough to not have moved back in with us, and so we can return the favor.

I wonder if the people in favor of raising the retirement age to 70 have thought about the unemployment problem. It is already tough for kids right out of school today, and that would make it tougher. I also wonder if there will be a bimodal distribution of the retired, split between those of us who saved and are going to be comfortable and those who didn't. My son-in-law's parents were heading for serious trouble before his father died before getting around to reducing his life insurance. No savings, tons of loans, a real mess.

gonzomax
07-28-2011, 12:16 PM
One third of retirees have Social Security as their only income.

Wesley Clark
07-28-2011, 07:53 PM
I wonder if the people in favor of raising the retirement age to 70 have thought about the unemployment problem. It is already tough for kids right out of school today, and that would make it tougher. I also wonder if there will be a bimodal distribution of the retired, split between those of us who saved and are going to be comfortable and those who didn't. My son-in-law's parents were heading for serious trouble before his father died before getting around to reducing his life insurance. No savings, tons of loans, a real mess.

I don't get the impression that it factors in to the debates, just discussions on what looks good on paper. Neither does the concept that finding employment in your 50s and 60s is extremely hard when people talk about raising the SS and medicare age.

Most people haven't saved enough for retirement.

http://www.schwab.com/public/schwab/research_strategies/market_insight/retirement_strategies/planning/baby_boomer_reality_check.html

According to the 2011 Retirement Confidence Survey conducted by the Employee Benefit Research Institute (EBRI),1 the following is true of workers aged 55 and older:

About 60% have less than $100,000 in retirement savings
36% have saved less than $25,000
29% have saved less than $10,000

As a point of reference, of all workers surveyed:
76% have less than $100,000 saved
56% have less than $25,000 saved
46% have less than $10,000 saved