New vernacular for the retiring boomer
By now, we have all heard the term baby boomer. The U.S. Census Bureau defines them as people born between the years of 1946 and 1964.
In general, boomers have been associated with a redefinition or outright rejection of the traditional values of previous generations. The boomer generation has been widely associated with privilege as many grew up in a time of affluence in the U.S. and in Europe. As a group, they were the healthiest, wealthiest generation the world had ever seen. Nicknamed the “me” generation, the boomers went after what they wanted and they tended to get it.
Since the boomers have been redefining just about everything since their birth, there was no reason not to think that the same would not happen in retirement. Being less likely to retire at 65 to the golf course, fishing boat or Lazy Boy as their parents did, this generation of retirees has different plans.
That was all before last year’s market and real estate meltdown. Now just about everything has changed. Misfortune often creates opportunity so for the boomers whose plans have been completely derailed by the current economy, a new lifestyle lingo is emerging.
The first one “the sandwich” was around before the market’s melted down, but it now may become a reality for many. Sandwich boomers will be taking care of aging parents as well as adult children or grandchildren living at home. The bad economy will force families to rely more on each other than government sponsored social services. It could make economic sense for several generations to share space and household responsibilities in order to save money.
Then we will have the ” boomerang entrepreneur.” These folks will retire from one career job and start up their own business. This can fulfill not just the desire to own a business, but give boomers a way to continue to subsidize some of the burden of health care costs.
There will be the “jhobbie.” This boomer will turn his or her hobby into a job. Many become eBay sellers of the things they loved to collect. Some may decide to take their skills at golf or tennis and become a part-time teaching pro. You get the drift here.
The “playcheck” retirees will take temporary or part-time work to fund their hobbies or vacations so that they do not need to tap their decimated IRA’s. This also could work for those who want extra money for the holidays. It would be kinda like the old layaway days. I remember Mom would work at Whites Department Store in Augusta, Ga., for some extra Santa change so that Christmas would be a bit merrier for us kids.
The most popular new age retirement phrase may be the ” phase retirement.” During the next 20 years there should be more jobs created in the U.S. than people to fill them. With the boomers migrating out of the workforce, employers may find the ZPG (zero population growth) group following the boomers unable to fill all of the positions that the retirees vacate.
The solutions for both employers and retirees who simply do not have enough saved to fully retire is to offer middle ground choices. Retirees would stay on longer, but with flexible schedules and terms.
Finally, many boomers may have to face the fact that they spent, mortgaged, invested or frittered away what they thought was their nest egg and may never fully retire. Retirement age will be redefined as people live longer. Social Security benefits will be modified to delay retirement.
Your own assets that can be used for retirement income will be deducted from benefits and I am guessing a host of other restrictions will be placed on government sponsored entitlement programs.
Much like cars, todays retirement will not be ” your fathers Oldsmobile.” We are moving into the hybrid age of retirement.
One personal note for those thinking about retirement soon. Consult an advisor, accountant and perhaps an estate attorney if you have not done so yet. This is not a good time to guess if you have saved enough or planned correctly.
Many 401K plans and IRA’s have seen their values cut in half, so your retirement date may need to be pushed back a bit. Be realistic with what you need in retirement income and understand the effects of inflation over time on your savings. Remember, you may live a long time and when you are 92 and have run out of money, it may not be the best time to go out looking for a job.
” Carol Perry, a Northern Nevada resident since 1983. The opinions expressed here are those of Carol Perry and may not reflect those of AWA Wealth Management or LPL.