Going for Broke

If you are one of those baby boomers who thought they had enough savings to retire on but now are scared of going broke….join the club. Boomers who considered themselves wealthy because they are sitting on six figures in savings are now thinking they may not have enough.

There was a time when retirees could spend 4 percent of their savings per annum without the risk of running out in the last 30 years of their lives. The new number according to the latest research – is down to 2.1 percent.

What happened? For one thing, we may live to upwards of 95 years old. Put that factor on top of rising housing, health and food costs and you have the perfect storm scenario that makes retirees resort to strategies that used to be reserved for not so rich boomers. Instead of enjoying their retirement funds, they are still squirreling away savings.

The general perception that boomers, who own half the nation’s wealth, are kicking back and having a ball, is not really the case. Federal Reserve data indicates fewer than half of all boomers have enough savings for retirement and 43 percent of 55 to 64-year olds had no savings at all in 2022.

Now you can understand why the new retirement plan is the no retirement plan. It also explains why so many boomers are coming out of retirement to go back to earning money to live on. Around 20 percent of Americans over 65 are employed. That’s about 11 million people, and they pull in about 7 percent of all wages and salaries paid by U.S. employers. Back in 1987, they made up only 2 percent.

Spending below your means may be the new lifestyle of the “I thought we were wealthy” crowd. If you’re feeling sorry for yourself, spare some sympathy for Gen Xers who are worrying about financial insecurity right now, never mind worrying about retirement woes ahead.

But, as Buddha advised, “Do not dwell in the past, do not dream of the future, concentrate the mind on the present moment.” Or as many fathers said to their sons, “Get a job!”

Jay Harrison is a writer and creative consultant for DesignConcept. His newest mystery novel, Rio Puerco Demise is available on Amazon. His first mystery novel, Head Above Water, is also available on Amazon. But that’s not all. You can also purchase the Best of BoomSpeak on Amazon.