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.

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

Ah....life 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.

Will to Live Trumps Living Wills

I guess you could blame the “forever young syndrome” (just made that one up), but what else would account for the fact that 64 percent of boomers admit to not having a health care proxy or living will. This startling fact comes to us via an Associated Press-LifeGoesStrong.com poll.

Bottom line, boomers are feeling healthy and don’t wish to dwell on death. Therefore, they feel they don’t need to address end-of-life issues. Despite plenty of high profile cases where individuals had no explicit instructions as to their medical care, more than half the boomers born between 1946 and 1964 have opted to ignore the potential for such calamities.

Ahem, ahem. That’s me -- clearing my throat. I don’t like to dwell on death either, but look around people. Friends and acquaintances you used to know are not with us anymore. When you were in your 40s or 50s, it didn’t seem like a big deal when you heard that someone in their 60s had died. Then, ever so gradually, you started to hear about people who died and were the same age as you. Creepy, but you put it in the back of your mind. Fast forward to present day, and now you’re realizing that more folks that you know are dropping out of your cohort (a new euphemism for the act of dying). The reality for all of us is that we are going to continue to lose these friends and acquaintances -- at an alarming rate -- in the not too distant future.

Experts remind us that even if you’re the picture of health it’s still a good idea to have a living will that specifies your wishes for medical care if you’re unable to communicate those wishes to your doctor. At the very least, a health care proxy gives you the ability to select someone you trust to make decisions about your medical care.

Do yourself a favor (and for those who love you) and visit this link on how to create your own living will or advanced medical directive. Each state has different laws regarding living wills but the Resources link will help you sort that out.

Denial is a big river. But when the boat starts to take on water, you might wish you had a can to bail it out. It wouldn’t hurt to do a little planning for when the day comes that you’re unable to express yourself. And therein lies a poignant irony. Boomers are known for expressing themselves, and yet, the death denial response is so strong that we/they/you cannot bring ourselves to plan for that inevitable day. The river doesn’t flow forever.

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.

What Golden Years?

It’s tough enough that boomers need to keep working because of shrunken retirement funds, but even worse when we’re accused of preventing the next generation from assuming our jobs.

Edward P. Glaeser is a professor of economics at Harvard and the author of “Triumph of the City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier and Happier.” He wrote a piece for the New York Times titled Goodbye, Golden Years.

So when he says that it’s a myth that boomers are robbing younger workers of their chance to move up, we should listen.

Glaeser notes that boomers keep working because they believe they cannot afford to stop. About 40 percent of 55 to 64 year-olds do not have retirement accounts. Almost a quarter do not even own stocks or savings bonds. Their median net worth is now $254,000 (including housing), which is down from $273,000 just three years ago.

But Glaeser thinks that boomers remaining in the workplace may turn out to be a good thing for young workers, even if it sounds counterintuitive. Boomers may crowd out younger workers in some instances, but as older workers continue to earn wages, they buy more products produced by younger workers. Boomers will also continue to pay taxes that help our overall fiscal problems gold nestegg while they bring a diversity of perspective and experience to the workplace.

Glaeser’s hope is that older workers, who may be more inclined to be entrepreneurial, will start new businesses. Statistically, the older you are, the more likely you are to become self-employed. And that self-employment in turn can generate jobs and taxes.

Maybe the whole idea of retirement at 62 or 65 was a mid-century aberration. It was not always a foregone conclusion that workers would throw in the towel as soon as they hit the magic number.

If boomers find fulfilling work or self-employment well into their 70s, they just might find that the golden years are golden after all. Or at the very least, a little more time to earn some green.

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.

Boomer Dream Cars

Forbes Magazine recently ran a feature on Baby Boomers’ Top Ten Dream Cars. We might as well be doing a Porsche BoxsterDavid Letterman Top Ten list, because these are some pretty expensive toys. Dream may be the operative word, because these cars have a might hefty entry fee.

Seriously....how many baby boomers do you know who are buying $40,000+ cars because they can? They must be Forbes subscribers, so maybe it does make sense. If you have high earnings and piles of investment cash, Forbes can guide you as to how to enhance this nest egg. What’s alittle splurge every now and then? Satisfy that whim....get rid of the SUV or minivan and buy a Porshe Boxster (#1 on the list, MSRP: $48,100-$61,800). Over 80% of their sales are to boomers. Or you could go with #2 on the list...BMW 6 Series Convertible. It’s only $90,500. Screw it! You want the best? Plunk down $102,600-$198,750 and get yourself a Mercedes-Benz SL. Nearly 70 percent of these are purchased by boomers.

Despite coming in at #10, it’s no surprise that 63 percent of all Corvettes are sold to boomers. A favorite of boomer kids growing up, now’s a great time to finally live the dream. MSRP: $49,045-$110,300.

For thos e with “only modest portfolios” (Forbes description, not mine), the #5 pick is the Mitsubishi Eclipse Spyder. Sixty-six percent of their sales are to those “on the verge of retirement.” MSRP: $27,999-$32,599.

The funniest/most out of place car on the list? That’s easy. #8, the Chevrolet Aveo. According to Forbes, this is the choice of “empty nesters tapped out by paying for college tuition or making a late effort to sock away retirement savings.” MSRP: $11,965-$15,365.Forbes also notes that it is “Small and underpowered, frugality is its prime virtue.” There’s a ringing endorsement.

AveoWhere are the cars with montly payments of less than 200 bucks? Other than the Aveo, you can forget about it. No Ford Fusions, Chevy Maiibus, Toyota Camrys. No Hondas, Nissans, Volkswagens, Mazdas, Kias or Hyundais. Not even a Mini Cooper. Oh, wait, this isn’t about reality, it’s about dreams.

What was it that Robin Leach used to say on Lifestyles of the Rich and Famous? At the conclusion of each show, he hoped that we would experience “champagne wishes and caviar dreams.” Some of us can swing the champagne part, but we’ll be toasting the Subaru, hoping that we’ll get 200,000 miles out of it.

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.

Boomers Give Florida Cold Shoulder

Here’s a not so far from the truth In-Search-Of ad in a Florida newspaper:

FOXY LADY: Sexy, fashion-conscious blue-haired beauty, 80’s, slim, 5’4” (used to be 5’6”), searching for sharp looking, sharp dressing companion. Matching white shoes and belt a plus.

But the joke may be on Flordia, because boomers are looking elsewhere for retirement havens. For more than 50 years, retiring New Yorkers found Florida was their top destination. Now...not so much. In 2005, Florida accounted for 35 percent of New York’s net migration loss. In 2009, that share dropped to 11 percent, according to the Empire Center for New York State Policy [link here]. Where are New Yorkers heading if it’s not Florida? Try North Carolina.

What’s the story? More competition mostly. Other states are doing a lot more to lure retirees to their locales. But the biggest factor may be that boomers have loss equity and assets due to the meltdown and must now explore less expensive retirement options --- if they can afford to move anywhere.

Even if their stock portfolio has empty recovered somewhat, a lot of boomers may opt to stay put. Part of the equation is shrinking home values. If your house isn’t worth what it used to be and your savings have a dent in them, staying put may be the more attractive option. Add to that the fact that many boomers would like to remain close to family and friends, and you have a compelling case for nixing the whole retirement-in-the-sun scenario.

The new retirement paradigm may be to keep the house you’re in and take vacations or multi-month respites in warm locales. A note of caution though: if you drive in Florida be on the lookout for Herman.

As a senior citizen was driving down the freeway, his car phone rang.

Answering, he heard his wife's voice urgently warning him,

"Herman, I just heard on the news that there's a car going the wrong way on 280. Please be careful!"

"Hell," said Herman, "it's not just one car. It's hundreds of them!"

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.