The oldest baby boomers will turn 63 this year. Their AARP invitations have arrived and they’re starting to ponder retiring. Many boomers have already claimed their Social Security due. But that doesn’t mean this large generation will quietly fade into retirement, even if they can still afford to. Here’s a look at some interesting stats from the past year.
1. Gray Nation. All of the baby boomers will be age 65 or older by 2030. At this point nearly one in five U.S. residents is expected to be 65 and older, according to the Census Bureau.
2. Dollar signs. Baby boomers are the wealthiest generation in U.S. history. They have collectively earned $3.7 trillion, more than twice as much as the $1.6 trillion that members of the silent generation did at the same age, according to the McKinsey Global Institute. Too bad they didn’t save much of it, and much of what was saved was recently lost in the stock market.
3. Market losses. Baby boomers who have done some planning for retirement reported worse financial crisis losses than those who didn’t plan, according to a Consumer Reports National Research Center poll conducted in November. That’s because many retirement planning strategies encourage workers to take on some risk. Before the financial crisis, diversifying beyond bonds and CDs in moderation would have put you on the path to a secure retirement, but it proved punishing during the current financial crisis.
4. Generation Glum. Baby boomers feel more dismal about their lives than adults who are both older and younger, according to a Pew Research Center survey, especially about money. Some 55 percent of baby boomers say it’s likely that their income won’t keep up with the cost of living compared to 43 percent of older adults and 44 percent of younger adults.
[See Generation Glum]
5. Social Security. Many baby boomers plan to sign up for their Social Security checks at age 62, the first year recipients can apply. A recent Fidelity Investments survey found that 45 percent of current 61-year-olds will sign up as soon as possible, most because they need the funds to pay for basic living expenses, such as food, utility costs, and mortgage payments. But if you can, it pays to wait. Payouts increase by 7 to 8 percent for each year you delay claiming between age 62 and 70. That’s a better return than most people are getting in the stock market right now and it lasts the rest of your life. Even the new Social Security spokesperson, Patty Duke, 62, who is featured in ads signing up online plans to wait to collect her due in real life.
[See Survey: Baby Boomers Will Claim Social Security at Age 62]
6. Becoming grandparents. Some baby boomers are likely to move in with their adult children when they retire. Intergenerational households often save money on housing costs. And there are more adults to share childcare, and, if needed, eldercare. Over 3.6 million parents lived with their adult children in 2007, according to Census Bureau data. And 24 percent of baby boomers anticipate that their parents or in-laws will move in with them, according to the AARP. Even President-elect Barack Obama’s mother-in-law, Marian Robinson, 71, will soon move into the White House - at least temporarily
7. Political divide. We like to stereotype baby boomers as being aging ultraliberal flower children from the 60s. But in the most recent presidential contest, this giant generation was nearly equally divided between President-elect Barack Obama and Senator John McCain. It was the children of the baby boomers who overwhelmingly supported Obama. McCain won the support of a majority of seniors (the only age group to back him), according to exit polls.
8. Drug Use. Another stereotype about baby boomers – that they use illicit drugs more than older generations – appears to have some merit. A confidential survey by the Substance Abuse and Mental Health Services Administration found that the rate of illicit drug use among 50 to 54-year-olds increased from 3.4 percent in 2002 to 5.7 percent in 2007. And among those between the ages of 55 and 59, drug use more than doubled from 1.9 percent in 2002 to 4.1 percent in 2007. The authors of the report say these trends may partially reflect the aging into these age groups of the baby boomers.
[See Baby Boomer Drug Use]
9. Working longer. A whopping 70 percent of Americans currently age ages 45 to 74 plan to work during their retirement years, according to an AARP survey, for both enjoyment and because they need the money. Most respondents said they would prefer part time work. Even before the financial crisis, it would have been a good idea for baby boomers to consider working longer because of increasing life expectancy. Now, it will take over a year in the workforce for baby boomers simply to recoup market losses. Employees who have spent between 20 and 29 years on the job will have to spend 1 year and 9 months working to neutralize market losses, according to calculations by Jack VanDerhei, research director for the Employee Benefit Research Institute. If workers move their money out of stocks and into safer investments like money market funds it will take the typical worker 2 years and 1 month to recover from the financial crisis.
10. Creative jobs. Retail salesperson is currently the most common job for older workers. But baby boomers are expected to find other things to do. Hot jobs are likely to include personal financial advisers, veterinarians, and social and community service managers, according to an Urban Institute study. Highly educated workers will generally have an easier time finding work, and computer skills won’t hurt either.
[Check out The 20 Fastest-Growing Jobs for Aging Boomers]