Friday, February 26, 2010

BOOM OR BUST: PLIGHT OF THE BABY BOOMERS


I just finished reading yet another article regarding the plight of the baby-boomers and their lack of retirement savings. Because so many have not saved enough for retirement or lost a huge amount during the financial crisis, the boomers are behind in their needs for retirement income. The longevity expected for many of these boomers only adds to their dilemma regarding ample incomes for their golden years.

Simple enough, right? They need money. But how to get it?

The article went on to say that the boomers must be careful not to invest too cautiously so that they can make up their losses in time for retirement. Experts believe that a portfolio heavily weighted in stocks is still they way to make up for lost ground.

Now I wouldn’t be so angry about this article had it not be for reading multiple others just like it on so-called “reputable” news sources and which quoted “experts” giving similar advice.

Okay, let’s think about this. Haven’t many of these boomers just lost close to half of their retirement savings in the stock market? And now the experts are advising them to continue putting the rest of their money at risk?

“Sure”, the experts say, “you have to have a strong return to prepare for retirement.”

I say to the “experts” -- “Do you?”

Is it really necessary to risk whatever you have left for a chance at happiness in retirement? The same retirement that is lacking in many of the expenses found in a pre-retirement lifestyle? The same retirement that is often devoid of expenses bound to raising children, educational costs, a mortgage, a higher tax bracket, work-related costs such as transportation, and a variety of other pre-retirement expense categories? The same retirement bolstered by social security, Medicare, a possible pension, tax-related senior benefits, and a slew of senior discounts for everything from movies and food to garbage collection and public transportation?

Are these “experts”, whose salaries are often paid by making investments at the risk of others, truly advocating what is best for the boomers? Or are they simple advocating what is best for them? Maybe, a low return on investments isn’t such a bad thing after all. Having your money making a small return is better than loosing half of it in another bursting market bubble or crisis. What then?

I say to the “experts” -- “Give the boomers some credit. I think they are resourceful and innovative enough to find ways to cut costs in retirement or supplement income in other ways if they have to. They have made it this far on their own, stop interfering with their money and let them make their own decisions. Don’t you realizing you’re ripping off your own parents?”

2 comments:

  1. Great article Kris. I completely agree with boomers avoiding risk and looking for other ways to save. I don't think all experts are out to rip off their parents, but I do think it's easier for them to go to the casino with someone else's money!

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  2. Very true. Wasn't going for a literal translation there, but I totally agree with your casino point.

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