Boomer Wealth

[DawgMan]

So here's a poem that has always resonated with me and IMHO speaks to the topic at hand...

Hard times create strong men,
Strong men create good times,
Good times create weak men,
Weak men create hard times.

At a macro level, I would argue most baby boomers (I am part of the last class at age 58) are defined as "Good times". Most of us probably never served in a war and arguably lived as working adults in the most prosperous stretch of the market/economy when compared to recent generations before us. Naturally, we like to enjoy/indulge our good times with our family/kids which can make the next generation soft. Politics aside, I unfortunately see it in reflected in our culture today, especially with the next generation. While my goal/hope has been to equip my kids to be "Strong men", unfortunately, IMHO, I do see this cycle playing out in society as a whole. I hope I'm wrong!

 

[jim584672]

Don't you know Boomers could buy houses with part time jobs and no education back in the day. Millennials actually believe stuff like this. I'm GenX so leave me out of it.

 

[Still Learning]

My wife and I are in the 1957 class and retired 3 years ago. We have a single daughter who we provided with a paid college education/graduation car so she could launch debt free. She told us she would pay her way upon graduation and has done that while living an independent life, yet close enough for frequent contact. She currently works 2 jobs and has started a business with a partner without loans/gifts and the business is cash positive in the first year. She is currently the exact opposite of her parents who worked corporate/school jobs with pension/401K/mutual fund investing. She wants to create her own work situation.



Our daughter will inherit everything when we pass and is aware of that. The amount/assets are totally unknown until that day comes. If a situation occurs where a cash gift would substantially influence her future I would consider the opportunity it may provide her to grow. It would definitely not be for a car or vacation.

 

[Andre1969]

So that's 20% not working? Isn't frictional unemployment supposed to be 4%? I do realize that is 4% of those wanting to work.

I know my personal experience is hardly the gospel, but off the top of my head, I don't know a single person in the, say, 20-35 group, who's not working. Some of them are under-employed. And, at any given point in time, there might be one in between jobs. But I can't think of anyone who's long-term unemployed.

One of my friends, a 32 year old Mexican guy, is pulling down something like 40 hours per week at Taco Bell and then another 30 at McDonald's! In Mexico, he worked at a bank, but he says that he actually makes more money coming here to the US, working fast food.

As for "wanting to work?" In the words of Ruth Gordon, "Up-CHUCK on all that!" Heck, I've had W2 income since 1986, have steady employment, but I don't WANT to work!

 

[Andre1969]

Don't you know Boomers could buy houses with part time jobs and no education back in the day. Millennials actually believe stuff like this. I'm GenX so leave me out of it.

Try telling them the truth, about how it was customary to put 20% down, high interest rates and such, and they just can't grasp it. For example, my Mom bought a house in 1979, for $54,000. 20% down would have been $10,800. Plus, closing costs.

Well, $10,800 back then would get you a really nice Buick, Olds, or Chrysler. And then the rest would have to be financed, at what? 15% or so? That $54K house was also a 26x45 foot rambler with 2br/1ba and a carport. Well and septic. No dishwasher (unless you count Mom and me).

So, to live like my Boomer parents, you basically had do the equivalent of paying cash for a really nice Electra or New Yorker, and then taking out a loan that they'd probably call "usurious" or something, to live in a place that they'd consider to be a craphole in the middle of nowhere.

And let's not get into the fuel crisis and recession that were brewing around that time. Yeah, these young'uns might laugh at my Mom struggling with $1.10/gal gasoline. But factoring in inflation, that's about $4.50/gal today and it was getting sucked down by a '75 LeMans that would get 15 mpg on a good day if there was no traffic and it was a pure highway run. Yep, good times!

 

[nwsteve]

As Boomers a lot of us have an early 70's internal reference point--the era of the Millionaire Next Door. As a refresher on value, I just checked the inflation adjuster website and using US CPI data, a Million dollars in 1970 would require 7.4 million today to have the same purchasing power (https://www.calculator.net/inflatio...ear1=1970&coutyear1=2022&calctype=1&x=66&y=30).
Certainly, our net worth is NO where near this sum, but we still have a comfortable life.

 

[explanade]

I expect that by the time they are 63, a great many of the Gen Z'ers will have as much as I have today (inflation adjusted). In fact, many of them will do much better, since they won't have started out so deeply in the hole as I had to.

OK Boomer.

Actually the Gen Z and younger Millenials express generational resentment.

Boomers took all the money, spoiling the environment in the process and causing polarization to push through these policies leading to inequality and environmental destruction.

 

[Gumby]

OK Boomer.

Actually the Gen Z and younger Millenials express generational resentment.

Boomers took all the money, spoiling the environment in the process and causing polarization to push through these policies leading to inequality and environmental destruction.

I thought my prior comment was expressing great confidence in their abilities and diligence. But if some of them are just looking for excuses, then they should look elsewhere.

 

[daylatedollarshort]

As Boomers a lot of us have an early 70's internal reference point--the era of the Millionaire Next Door.

The Millionaire Next Door book first came out in 1998.

 

[Koolau]

As one of a married couple both in this age range, it seems increasingly likely that we will spend down our retirement savings on long-term care and high-cost senior housing options after age 75.

I'd prefer not to live in a suburban single-family house much past 75, but theBu options for modern housing suitable for older seniors are eye-wateringly expensive--even without any care or meals included.

This is especially true for housing that is supposedly FOR senior living. If it says "over 55" or "Senior Living" or especially if it calls itself "assisted living."

We live in "just a condo" which is about median priced in our area. Because of the building's advancing age, our HOA dues (mostly maintenance) have been going up. Our only amenity is a pool. So, we "live" for roughly half what an "assisted living" unit of similar size would cost. As long as the two of us are fairly healthy, it works very well for us. Once one us is less capable or gone, the calculous changes. We've made financial provision for that time (within certain limits, of course.) Getting old isn't for wimps and that's for sure!

 

[NW-Bound]

... As long as the two of us are fairly healthy, it works very well for us. Once one us is less capable or gone, the calculous changes. We've made financial provision for that time (within certain limits, of course.) Getting old isn't for wimps and that's for sure!

Yes, getting old and invalid is tough. It helps to have some money, but then you need careful planning.

I personally know of a couple who despite having money were miserable before the death of one of them. It was because they had no relatives, nor close friends who could watch out for them on a continual basis. All that money does you no good, if you cannot get good help.

The husband died alone at home, and was discovered only because a neighbor noticed no activities for a few days, and called the police. His wife had been and still is ward of state in an Alzheimer facility.

 

[brett]

Our two children, and our other relatives for that matter, have no idea what we have.

We lead simple lives but we do not want for anything. Our big spend is on extended travel.

We are taking care of providing for each of our grandchildren's post secondary education expenses. Via an edu fund. Plus an off the top estate amount for each grandchildren's edu costs before any of their parents get paid out from the executor. It is on a take and play basis. Only three of them so far but who knows if there will be more!

The wealth management firms are very active at the moment. Lots of adverts plus some mergers. The tsunami of wealth transfer is already underway.

 

[HarveyS]

Average unemployment rate in the U.S. is 5.74% and we are at 3.7%, so by historical standards the employment rate is high.
]

Respectfully, I believe you are making a common error.

One cannot determine the employment rate by looking at the unemployment rate. Unemployment measures those out of work and looking for work.

Employment rate is measured by workforce participation - the percent of the working age population actually working or looking for work. Workforce participation has dropped from about 67% in 2000 to about 62% today. About half of this decline is attributed to retiring baby boomers. The other 2.5% (or about 6 million people) is blamed on a variety of factors.

I maintain, by historical standards, the employment rate is quite low and has been shrining for the last two decades. Thus all the "Now Hiring" signs.

 

[NW-Bound]

Our two children, and our other relatives for that matter, have no idea what we have.

We lead simple lives but we do not want for anything. Our big spend is on extended travel.

We are taking care of providing for each of our grandchildren's post secondary education expenses. Via an edu fund. Plus an off the top estate amount for each grandchildren's edu costs before any of their parents get paid out from the executor. It is on a take and play basis. Only three of them so far but who knows if there will be more!

The wealth management firms are very active at the moment. Lots of adverts plus some mergers. The tsunami of wealth transfer is already underway.

My two children don't know how much we have, other than it's 7 figure. Their careers have been successful so far, so will not need an inheritance (though I am sure they will not mind getting some ).

No chance of grandchildren.

We don't have fancy tastes, nor covet expensive toys. The only thing we enjoy is travel, and after this 31-day Europe trip, realize that this is our limit, and we can do this perhaps only 1/year. We already miss home too much.

Maybe the market god will take back all the generous bounty, and I will not have to worry about what to do with unspent money.

 

[Koolau]

My two children don't know how much we have, other than it's 7 figure. Their careers have been successful so far, so will not need an inheritance (though I am sure they will not mind getting some ).

No chance of grandchildren.

We don't have fancy tastes, nor covet expensive toys. The only thing we enjoy is travel, and after this 31-day Europe trip, realize that this is our limit, and we can do this perhaps only 1/year. We already miss home too much.

Maybe the market god will take back all the generous bounty, and I will not have to worry about what to do with unspent money.

Let's hope we all end up with way more than we need. What a great problem to have!

 

[Gumby]

"Count no man happy until the end is known"

- Solon, as reported by Herodotus

 

[GravitySucks]

Trying to give some to the kids now. Helped DD2 buy a house last year but she's insisted on paying me monthly installments.
Bought DD1 a few gifts that she wouldn't splurge on herself.
If I live to 90 they'll be 75 and 70 when they inherit it. I'd rather they enjoy some of it now.
Read "Capital in the 21st Century" earlier this year. One of the authors findings was the Boomer generation is on track to bring inheritances back to historical levels not seen since WWI both in the US and Europe.

 

[youbet]

One son and three grands.

Son and DIL have decent careers and are moderately effective savers/investors. My plan to to leave them enough of a chunk that, added to their own portfolio, they can FIRE at will. They don't know this.

Oldest grandson is special needs. A special needs trust I'm funding takes care of him.

The youngest two grandkids seem to be both bright, level headed and loyal. They'll receive enough to give them a nice jump start in their financial lives. One is a junior at a top ten engineering school. The other is a junior in HS and wants to do a double major in CS and linguistics. I'm 100% funding their post high school educations.

If someone is especially attentive to our geezer-needs going forward, they'll be rewarded financially. Otherwise, no one in sight, extended family or friends, we're planning on cutting in on the FIRE portfolio residual.

 

[Mulligan]

Old people have been saying nobody wants to work any more since at least the 1800's. There's a compilation on twitter of newspaper headlines saying exactly that, or something very similar, called "A Brief History of Nobody Wants to Work Anymore" -

https://twitter.com/x/status/1549527748950892544

.

I think the problem dates back even further. John Smith at Jamestown in 1600’s seemed to have this problem at the Colony too, thus this edict….

You must obey this now for a law, that he that will not work shall not eat (except by sickness he be disabled). For the labors of thirty or forty honest and industrious men shall not be consumed to maintain a hundred and fifty idle loiterers.

 

[Out of Steam]

Don't you know Boomers could buy houses with part time jobs and no education back in the day. Millennials actually believe stuff like this. I'm GenX so leave me out of it.

We also all got our choice of a brand new V8 Camaro or Mustang for our 16th birthday.

 

[MuirWannabe]

https://youtu.be/T3PvcpWbUIg

 

[Koolau]

I think the problem dates back even further. John Smith at Jamestown in 1600’s seemed to have this problem at the Colony too, thus this edict….

You must obey this now for a law, that he that will not work shall not eat (except by sickness he be disabled). For the labors of thirty or forty honest and industrious men shall not be consumed to maintain a hundred and fifty idle loiterers.

I don't know the cultural background of the folks at Jamestown. But there are whole cultures who expect to "eat free" off those who are more prosperous. If that was the case at the founding of Jamestown, John Smith was pointing out that it was no longer in effect - by law (decree, really.)

I attended a meeting where a missionary was reporting on his work to aid a group of folks who were in abject poverty. Many of the folks were relatives to others in a subsistence farming community. The missionary described one of the built in problems preventing these folks from ever getting out of poverty.

The missionary arranged for a farming expert to work with one of the farmers, showing him how to increase yields. It wasn't through intensive "chemical" means, but through well known sustainable methods. The farmer's crop that year was bountiful beyond any expectation. So his relatives stopped farming, moved in with the farmer and ate his bounty. The "enlightened" farmer went back to his old methods and his free-loading relatives had to go back to their inefficient farms.

My point is that work ethic or whatever we want to call this portion of our discussion is as much cultural as it is economic opportunity. I doubt most of us would dispute that there have been significant cultural shifts, generation to generation in our life times. Not saying that's the whole story of the age-old "youth vs age" phenomenon. Just sayin'... It IS a factor whether we like it or not. Of course, YMMV.

 

[Andre1969]

We also all got our choice of a brand new V8 Camaro or Mustang for our 16th birthday.

Yeah, but the boomers toward the tail-end were getting stuff like a Mustang II, or a Camaro with a smogged-down 267

 

[RobbieB]

When I was 18 I got a hand me down 10 year old Ford with 80,000 miles on it.

 

[aja8888]

When I was 18 I got a hand me down 10 year old Ford with 80,000 miles on it.

You didn't have to pay for it?