There are endless articles these days about the problems the US baby boomer generation will face with pensions questionable and inflation eating away at their savings. These people, born between 1946 and 1964, are just now reaching 65 and retiring – the ones who can afford to, that is. Many are continuing to work at least in part time jobs. They are known as “boomers” because they have grown up in boom times and have not known the poverty their parents experienced during the depression. There is some evidence that as a group they have spent more too and saved less than their parents. As Wikipedia points out, “ In Europe and North America boomers are widely associated with privilege, as many grew up in a time of widespread government subsidies in post-war housing and education, and increasing affluence.”
However, there is some good news for the Boomers. First, the percentage of elderly compared to the total population will increase for the next two decades. However, compared to some other countries such as Japan, Poland or China, the increase will not be that much (see chart). One of the reasons for this is the number of immigrants coming into the US, most of them younger and employable who often have more children than the average American family.
China on the other hand, due to its one child policy faces another demographic crisis. Due to the Chinese culture preference , more boy children were born than girls. What will China do to even this out – allow foreign women, encourage some of the only male children to leave China (unlikely) or allow 2 husbands for one woman (also unlikely). Another factor is helping the baby boomers. Their children , sometimes called the “echo boomers” are reaching their prime work years. In fact, it would benefit this group if the Baby Boomers would retire to free up the jobs for the Echo Boomers.
Lastly, Ben Casstleman points out that the Baby Boomers are no longer the largest demographic group.
Boomers are no longer even the largest age cohort; more of today’s Americans were born in the 1980s and 1990s than in the postwar years. As today’s teens and 20-somethings enter the workforce, they will partly offset their parents’ exit. Indeed, for many young people, mom and dad can’t retire soon enough; some experts argue that boomers, by staying in the workforce longer than past generations, are essentially clogging the usual professional pathways, leaving few opportunities for people beginning their careers.
Returning to the financial problems of the Baby Boomers, whether they are a large group or not, they still need money, and their savings are fast disappearing with inflation and decreased prices for stock and bonds as well as their residences. In future articles I will suggest some measures to take to remedy the treat of poverty and poor health care – something more secure than sticking money under your mattress.