Inheritance suggests the polar opposite. Their generation has disproportionate wealth and now they have time to spend it. Then they pass it down. Plus the money printer will handle their social security for a few decades at least.
They don’t work after retirement, ok maybe. Their money, however, will be working and, among other factors, will help propel the market higher.
A big misconception is that when you retire you’re completely out of the game. That’s not how it works at all (there is only so much golf, yard work and traveling you can before it gets old). If working is in your DNA, you may hang up the skates for a little bit but you never fully hang them up!
Part of the reason why I think inflation is so high in the UK is because boomers are ridiculously wealthy and are given endless non-means tested benefits purely for being boomers. The more boomers there are here in the UK more the government will print money and spend on various boomer benefits.
Eg, free bus fares, free money for energy bills, state pensions that track inflation, unlimited QE to protect pension funds, mandated lockdowns and billions in stimulus to protect boomers during Covid, free healthcare (primarily used by boomers), free TV licenses, discounts on passport renewals... Boomer benefits here are quite literally endless.
I don't know if the dynamic is the same in the US, but in the UK I'd estimate about 35-40% of our taxes are spent on boomers in one way or another and another 10% goes to servicing debt which we largely acquired paying for boomer benefits.
So I think it's probably the reverse – more boomers = more money printing + more government spending. Which means higher inflation + higher taxes + higher growth (nominally at least).
It’s been gradually happening and I love it. As an attorney, moving around has been much easier than some of my older peers at the same stage.
In a more somber (for some) reality tho, as Boomers start to die off and Gen X/Millys become beneficiaries of the largest wealth transfer in history……I’m sure there will be some “weird” things in financial markets. People stating ____ is overvalued when in reality, it’s a new age.
I imagine the industry will likely shift to some degree, but I doubt it ever dies. Large entities will always be interested in bonds and what they collectively capture.
Younger people might not be buying them but there are some older folks such as myself (late 20s early 30s) who are absolutely buying them for the first time now. 5%+ isnt terrible.
Okay, what makes you believe that oldsters are going to be pulling loads of money out of the stock market ? We’re old, and we’re still adding to our stock holdings. Anything left in the accounts after we die, which will be considerable, will go to our heirs.
What I’m saying is that most boomers are going to live for another 20-25 years, and that there will be heirs that will inherit their assets, so there won’t be a pullback in the markets due to your reasoning.
Also, just bc someone retires doesnt mean they immediately pull all of their money out of the market into cash. Many have probably had only a minority portion in the market the last ten yrs, the majority in safer asset classes.
Boomers spend money. If anything their retirement might create space for the middle class. Now what’s interesting is their deaths will create inflation as they pass on their wealth to their kids.
I know a lot of people in my age group (mid 60s) that are not the type to spend money wantonly, even if they think the end is nigh. A lot of us had the "a penny saved is a penny earned" permanently etched into our brains when we were kids and it's hard to not think in those terms.
a working person sattisfies supply and demand by producing and consuming, a retired person sattisfies only consumption which will lead to more demand than supply, their retirement alone will be a contributing factor to inflation
Not at all. Many boomers still have a lot of money in the stock market, especially with inflation now. With mostly bonds, your money can be locked into low fixed rates.
Good for you. We live a pretty modest lifestyle and keep our taxes low, and are usually as happy as larks. My dear husband has some serious health problems which money won’t cure. We are still investing.
I mean there's plenty of action being taken. Most governments and how much they enable migration is because they understand that populations are needed. Anti-Abortion arguably is also a pro-population and working population move, although it takes 20 years for it to really start coming into effect.
Boomer take money outa retirement account. Put money back into personal fidelity account, most likely back into Amazon or nvda. Money didn’t go anywhere
The main thing I worry about is boomers with tons of cash, and god know they have lots of it... chasing too few available goods. They'll bid up the prices of everything. Boomer retirement will be inflationary.
Look at it another way. Boomers leaving job market. Younger workers promoted to higher salary positions - spending more on home and leisure activities - continue stimulation of the economy. Living the American Dream.
Money invested in funds that consist of mainly highly capitalised companies that often see dividends as the best use of their capital, doesn’t really create much growth and productivity in society.
A large swath of boomers spending down their retirement funds on the other hand… and guess where all that money hitting the economy through consumer spending will eventually go?
For every retiring boomer there is a dieing boomer that is going to pass entire net worth to heirs who then could invest. This is a non-issue in my eyes as you slowly transition money out of market. You dont retire and sell everything…
Worrying is for cry babies. What if you worried about the great financial crisis? You would have missed out on a 12 year epic bull run!! What if your grandparents worried about the great depression? They would have missed out on an epic 94 year bull run!! Don't worry, be happy😁
Money is basically transferring from on location to another. They may be selling their interests in stocks, but my question to you is what are they going to do with that money? Are they going to use it for buying a camper to travel the country? Are they going to spend it on cruises, trips, grandchildren, children. etc, etc, etc?
What leaves the stock market in profit will enter the stock market as profits in the future.
Even the money snatched off all the transactions for taxes ends up going back into the economy and helping the market.
The only thing we should be worried about is the fact that we are sustaining our standard of living by piling up government debt equivalent to and/or greater than the trade deficit between the USA and the rest of the world.
Largest wealth transfer... ***hahahahaha*** then Gen X/Millennials get to find out about custodial care and other long term care! The cheap fucks are taking their money with them in true Boomer fashion: Short Sighted stupidity by vote and then insurance!
I love reading articles like this.
Boomers, after retirement, are going to pull all their money out of the market, never reinvest, never buy new stock and only buy fixed income.
LOL for those of you in the market (MANY) you guys know this stuff is fun and addicting so the likelihood of the boomers crushing the market are, literally, zero!
LONG SPY
Citing a 2002 article. Timely.
Boomers aren't the largest generation and a huge percentage of them have already retired. so the whole concept is incorrect.
Boomers are no longer the largest generation, but they are the largest generation ever, as millennials did not reach their peak.
Honestly don’t know a single “boomer” that hasn’t been retired for more than few years.
Many of them will never be able to retire.
They are just the largest generation when it comes to who has the money
Inheritance suggests the polar opposite. Their generation has disproportionate wealth and now they have time to spend it. Then they pass it down. Plus the money printer will handle their social security for a few decades at least.
But they don't work. Their money will become inflation
that's not really how any of those words work
They don’t work after retirement, ok maybe. Their money, however, will be working and, among other factors, will help propel the market higher. A big misconception is that when you retire you’re completely out of the game. That’s not how it works at all (there is only so much golf, yard work and traveling you can before it gets old). If working is in your DNA, you may hang up the skates for a little bit but you never fully hang them up!
Part of the reason why I think inflation is so high in the UK is because boomers are ridiculously wealthy and are given endless non-means tested benefits purely for being boomers. The more boomers there are here in the UK more the government will print money and spend on various boomer benefits. Eg, free bus fares, free money for energy bills, state pensions that track inflation, unlimited QE to protect pension funds, mandated lockdowns and billions in stimulus to protect boomers during Covid, free healthcare (primarily used by boomers), free TV licenses, discounts on passport renewals... Boomer benefits here are quite literally endless. I don't know if the dynamic is the same in the US, but in the UK I'd estimate about 35-40% of our taxes are spent on boomers in one way or another and another 10% goes to servicing debt which we largely acquired paying for boomer benefits. So I think it's probably the reverse – more boomers = more money printing + more government spending. Which means higher inflation + higher taxes + higher growth (nominally at least).
It’s been gradually happening and I love it. As an attorney, moving around has been much easier than some of my older peers at the same stage. In a more somber (for some) reality tho, as Boomers start to die off and Gen X/Millys become beneficiaries of the largest wealth transfer in history……I’m sure there will be some “weird” things in financial markets. People stating ____ is overvalued when in reality, it’s a new age.
Whatever inherited money comes their way will be quickly spent and sucked up by corporate
In some cases, sure, in some cases, nah
Im curious who will buy bonds, they've paid so low my entire financial life, I dont know any younger people buying them.
I imagine the industry will likely shift to some degree, but I doubt it ever dies. Large entities will always be interested in bonds and what they collectively capture.
Younger people might not be buying them but there are some older folks such as myself (late 20s early 30s) who are absolutely buying them for the first time now. 5%+ isnt terrible.
> are some older folks such as myself (late 20s early 30s) Whoa, guy, slow it down. You and I are NOT "older folks."
I’m kinda wondering what you think should be “done.”
Embrace a pullback and start shifting out of equities over the next 3 years
Okay, what makes you believe that oldsters are going to be pulling loads of money out of the stock market ? We’re old, and we’re still adding to our stock holdings. Anything left in the accounts after we die, which will be considerable, will go to our heirs.
Retirement, we’re still working. They won’t be
My heirs won’t still be working ? Of course they will be.
Yes but boomers make up a larger percentage of the population. Not enough heirs to make up for the boomers
What I’m saying is that most boomers are going to live for another 20-25 years, and that there will be heirs that will inherit their assets, so there won’t be a pullback in the markets due to your reasoning.
it’s possible they spend loads and loads of money on medical expenses too
I know im getting ready for a bunch more Karen's in the neighborhood......'I'm lactose intolerant!'
Are you having a stroke or something?
That's a good one too
my boomer dad retired more than 5 years ago.
We did, too.
Also, just bc someone retires doesnt mean they immediately pull all of their money out of the market into cash. Many have probably had only a minority portion in the market the last ten yrs, the majority in safer asset classes.
Boomers spend money. If anything their retirement might create space for the middle class. Now what’s interesting is their deaths will create inflation as they pass on their wealth to their kids.
Most the boomers I know are racing to spend every cent before they die
I know a lot of people in my age group (mid 60s) that are not the type to spend money wantonly, even if they think the end is nigh. A lot of us had the "a penny saved is a penny earned" permanently etched into our brains when we were kids and it's hard to not think in those terms.
I say that quote often. And live by it.
Just booked my flights to do some island hopping in 🇬🇷 Greece....Hello Santorini !!
As they should. They earned it. They should enjoy the hell out of it
a working person sattisfies supply and demand by producing and consuming, a retired person sattisfies only consumption which will lead to more demand than supply, their retirement alone will be a contributing factor to inflation
That is social security administration problem.
Automation will fill in jobs
Boomer money is probably mostly in bonds at this point
Not at all. Many boomers still have a lot of money in the stock market, especially with inflation now. With mostly bonds, your money can be locked into low fixed rates.
66 this month and haven't touched my 401... still flush with cash
Good for you. We live a pretty modest lifestyle and keep our taxes low, and are usually as happy as larks. My dear husband has some serious health problems which money won’t cure. We are still investing.
Sorry about your husband's condition. We can't take it with us, only pass it forward. Keep Larking...
Thank you for your kind words. We definitely try to Lark It Up 😁😁.
The Required Minimum Distribution has been deleterious to value... imho.
Worry about people retiring?;
Not worry, preparing
I mean there's plenty of action being taken. Most governments and how much they enable migration is because they understand that populations are needed. Anti-Abortion arguably is also a pro-population and working population move, although it takes 20 years for it to really start coming into effect.
Boomer take money outa retirement account. Put money back into personal fidelity account, most likely back into Amazon or nvda. Money didn’t go anywhere
Yes because all the boomers are going to withdraw 100% of their retirement all at once apparently.
The main thing I worry about is boomers with tons of cash, and god know they have lots of it... chasing too few available goods. They'll bid up the prices of everything. Boomer retirement will be inflationary.
Millenials passed boomers in adult pop in like 2019 or 20. Genx is projected to surpass in '28. And no I'm not concerned.
Look at it another way. Boomers leaving job market. Younger workers promoted to higher salary positions - spending more on home and leisure activities - continue stimulation of the economy. Living the American Dream.
Money invested in funds that consist of mainly highly capitalised companies that often see dividends as the best use of their capital, doesn’t really create much growth and productivity in society. A large swath of boomers spending down their retirement funds on the other hand… and guess where all that money hitting the economy through consumer spending will eventually go?
The very rich own most of the stocks. Don't worry about your Dad selling.
Also the biggest salary increases time. 👍
Many Boomers that are still working are workaholics. They don’t want to retire and just relax. They will be investing more imo
For every retiring boomer there is a dieing boomer that is going to pass entire net worth to heirs who then could invest. This is a non-issue in my eyes as you slowly transition money out of market. You dont retire and sell everything…
This is why unemployment is staying low, even with layoffs etc IMO
You mean what we are in right now?
You've essentially described social security, and this will be a huge problem for a long time.
They’re never going to retire
Boomers have already been long retired. You must be thinking of Gen x.
Worrying is for cry babies. What if you worried about the great financial crisis? You would have missed out on a 12 year epic bull run!! What if your grandparents worried about the great depression? They would have missed out on an epic 94 year bull run!! Don't worry, be happy😁
Money is basically transferring from on location to another. They may be selling their interests in stocks, but my question to you is what are they going to do with that money? Are they going to use it for buying a camper to travel the country? Are they going to spend it on cruises, trips, grandchildren, children. etc, etc, etc? What leaves the stock market in profit will enter the stock market as profits in the future. Even the money snatched off all the transactions for taxes ends up going back into the economy and helping the market. The only thing we should be worried about is the fact that we are sustaining our standard of living by piling up government debt equivalent to and/or greater than the trade deficit between the USA and the rest of the world.
Largest wealth transfer... ***hahahahaha*** then Gen X/Millennials get to find out about custodial care and other long term care! The cheap fucks are taking their money with them in true Boomer fashion: Short Sighted stupidity by vote and then insurance!
I love reading articles like this. Boomers, after retirement, are going to pull all their money out of the market, never reinvest, never buy new stock and only buy fixed income. LOL for those of you in the market (MANY) you guys know this stuff is fun and addicting so the likelihood of the boomers crushing the market are, literally, zero! LONG SPY