Financial planning tools and services to put you on the path to the future you want
Your guide to financial planning and retirement
Connect with peers and experts
Get to know the people behind the company and the mission behind the work
Digital financial planning and guidance at scale
July 1, 2020
According to the Pew Research Center, the oldest members of the Baby Boomer generation came into retirement age in 2011, and for the next 19 years, 10,000 more boomers will turn 65 each day. The Boomers face unique challenges as they approach retirement.
Unlike their parents, most Boomers are not able to rely on pensions and savings to financially sustain them in retirement. The financial hurdles that baby boomers face require them to rethink their strategies for retirement planning.
Previous generations were able to rely on pensions to provide a fixed monthly income in retirement. However, with pensions becoming less common, this is not an option for many baby boomers. Those approaching retirement age are finding that they are solely responsible for funding their own retirement.
However, lack of savings is another issue that the baby boomer generation faces. Many people who are approaching retirement age are continuing to struggle to make ends meet in this economic climate, while some are just not contributing enough to their 401(k) or investing effectively. Though their parents may have made saving a priority, many baby boomers do not have much saved. According to one survey, 33% of boomer participants had less than $50,000 saved for retirement.
Many baby boomers are finding that they must continue to work full-time, or at least part-time after they meet retirement age in order to sustain themselves financially. According to one survey by CareerBuilder, 75% of participants who are at or near retirement age said that they put off retiring because their finances were still recovering from the economic downturn.
Though many baby boomers will find themselves working as they approach retirement age, this is not necessarily negative. The CareerBuilder survey also found that more than half of those polled plan to continue working, just not at the same company, and 28% of participants said that they wanted to continue working because they enjoy it. This suggests that some baby boomers will continue to work and may even use this opportunity to find a new career.
Though baby boomers face many hurdles that their parents did not have to deal with, this does not mean that they are doomed in retirement. In fact, one survey shows that 97% of baby boomer participants said that they were satisfied with their lifestyle in retirement. The key to finding this satisfaction is to make a plan before jumping into retirement.
It is never too late to start planning for your retirement. Many people in the baby boomer generation have found strategies to make the most of their retirement income. Though retirement may not look like it did for your mother or father, there are still ways to find fulfillment in this exciting next phase of your life.
Many baby boomers are also part of the sandwich generation – people whose time and money are used by dependent children as well as aging parents. Here are three ways to alleviate the stress of being pulled in so many different directions:
Baby boomers have an extremely high rate of homeownership. This category of wealth may be a financial lifesaver for many. Your home equity can be used to help fund retirement in a variety of ways, through downsizing, home equity loans, or through a reverse mortgage.
The trick is knowing when and through which method to tap your equity.
Today, the average baby boomer life expectancy is 83 and the average 65-year-old man has a one in four chance of living until 92, while the average 65-year-old female has a one in four chance of living till 94.
Baby boomers are health conscious and medical advances are extending our life spans all of the time. So, even if you work into your 70s, you might still need to plan for a retirement that lasts 20 years or more.
Do it yourself retirement planning: easy, comprehensive, reliable
Take financial wellness into your own hands and do it yourself retirement planning: easy,
Share this post:
Our weekly newsletter full of inspiration, podcasts, trends and news.
© 2022 NewRetirement, Inc. All rights reserved.
Disclaimer: The content, calculators, and tools on NewRetirement.com are for
informational and educational purposes only and should not be construed as professional financial
advice. NewRetirement Planner and PlannerPlus are tools that individuals can use on their own behalf to
help think through their future plans, but should not be acted upon as a complete financial plan. We
strongly recommend that you seek the advice of a financial services professional who has a fiduciary
relationship with you before making any type of investment or significant financial decision.
NewRetirement strives to keep its information and tools accurate and up to date. The information
presented is based on objective analysis, but it may not be the same that you find on a particular
financial institution, service provider or specific product’s site. All content, tools, financial
products, calculations, estimates, forecasts, comparison shopping products and services are presented