Monday, February 20, 2012

Boomers Suffering from Withdrawal?

Not likely you say? Since when are baby boomers getting shy? Not talking about that kind of withdrawal. We’re talking about the kind of withdrawal you make at the bank, and specifically, what happens to the U.S. economy when a lot of baby boomers start withdrawing their savings and portfolios all at once.

Is this scenario just one more event that the 24 hour news machine would have you freak out about? Or is it real?

Let’s look at the numbers. There are 78 million or so boomers -- but they are not all retiring at once. However, according to the Investment Company Institute, 44 percent of all mutual-fund shareholders are baby boomers. So let’s say that over the next couple of decades, they all start drawing down on these funds. Are there enough younger investors behind them to pick up the slack? Doubtful.

The theory is that the economy drives the market, but you can’t discount demographics. Ten thousand people retiring every day for 20 years (and drawing down on their savings) is going to have a dramatic effect on the markets. Twenty years from now, almost 20 percent of Americans will be age 65 or over, and that’s a lot of people slurping away at their savings. Experts point to Japan’s stagnant economy for a lesson in what happens when more than a quarter of your population is over 65.

Yet another sign of trouble in paradise is the increasing number of boomers who are shifting to bonds and dividend income stocks as they near retirement. Investing for the long-run is no longer a viable option for boomers on the cusp of their twilight years.

So, is the sky falling or not? Boomers did have a bunch of kids and those kids are now investors themselves. That helps, but experts suggest three specific courses of action: 1) Avoid Japan and Europe and look to invest in countries with younger populations. 2) Match stock picks to national demographic trends (e.g. agriculture in India). 3) Stick with income-producing equites and corporate bonds.

Finally, my personal advice: stop watching the 24-hour news cycle and try to enjoy your final years on earth.

Jay Harrison is a graphic designer and writer whose work can be seen at DesignConcept and at BoomSpeak. He's written a mystery novel, which therefore makes him a pre-published author.

Sunday, February 12, 2012

I’m Gonna Live Forever

Like the theme song from Fame.

Baby, look at me
And tell me what you see
You ain't seen the best of me yet.
Give me time,
I'll make you forget the rest.
I got more in me,
And you can set it free
I can catch the moon in my hand
Don't you know who I am?

Remember my name. Fame!
I'm gonna live forever expectancy. What a cheerful topic. Sure, our peers are beginning to drop off the planet, but baby boomers are certain that they will live forever (or a reasonable facsimile). If you’re a man born in 1946, you can expect to live to age 83.5. Plus, if you make it to age 70, your redline increases to 84.7. HOW ABOUT THAT, as sportscaster Mel Allen used to say (before he stopped....because he died).

Census figures show that there are now over two million ninety-plus folks in this country and that number is expected to balloon to eight million by the year 2050. We may not be around to ring in that stat but plenty of younger boomers will make it 95 or even 100.

If we approach aging the way we approached everything else, we’ll have it mastered in no time. With better nutrition and better exercise, boomers will most likely be going full throttle in retirement. I’ve heard it said that retirement is not a passive sport anymore, and from what I can see, boomers are setting the bar very high for how much activity one can handle in their lives.

It all does come back to that old cliche: you’re as young as you feel. And boomers are clearly taking that to heart. How many times have you heard someone say that 60 is the new 40 or 50 is the new 30. The reality for many boomers is that they wake up feeling younger and more vital than their age would indicate. Aches, pains and maladies come with the territory, but boomers remain a remarkably resilient (maybe stubborn too) bunch.

So go ahead. Live forever. I’ll be right behind you.

Jay Harrison is a graphic designer and writer whose work can be seen at DesignConcept and at BoomSpeak. He's written a mystery novel, which therefore makes him a pre-published author.

Put Your Money In Ambulances

That’s right -- the next big investment opportunity if you want to see your money grow --buy an ambulance company. Competition among ambulance services for nonemergency medical transportation is getting fierce. Knoxville, Tennessee, for example, has two dozen services vying to take you to the hospital. Most of the runs are for pre-scheduled trips where a patient needs assistance, but there’s also the standby service where an ambulance is needed at sporting events or concerts. Think heart attack while rocking out to the aging Stones -- or maybe one of the Stones goes down. Either way, you can be assured that an ambulance is waiting outside to shovel up the afflicted (or affected) boomers and get them poste haste to hospital.

I can see where this may be going. At first, boomers will be content to use a standard ambulance, but as the competition heats up, they are going to want something different, something unique. I’m thinking muscle cars from the 70s. Convert a Pontiac GTO or Dodge Charger (maybe called the General Hospital) into an ambulance and boomers will climb all over that trend. Or how about a woody surf wagon with the surfboards still on the roof, Jan and Dean blaring on the sound system?

If you follow this logic to its inevitable conclusion, some boomers will start getting picky about what kind of ambulance they want to take to the hospital. Picture the guy who says, “I’ll wait for the next one,” in hopes of getting a cooler medwagon. Seem farfetched? Not if you’re talking about baby boomers who are very concerned with image. Arriving at the hospital or doctor’s office in a plebian, vanilla ambulance could wreck havoc with their reputation for good taste.

My suggestion would be if image is that important to you and you have the financial resources, buy your own ambulance and keep a driver/EMT on standby. That way you will always have a cool ambulance at your disposal, whether you’re at the beach or just taking in a ballgame. As crazy as it sounds, would you take a bet that it won’t happen?

Me neither.

Jay Harrison is a graphic designer and writer whose work can be seen at DesignConcept and at BoomSpeak. He's written a mystery novel, which therefore makes him a pre-published author.