Are Baby Boomers A Retirement Time Bomb?
Are Baby Boomers a Retirement Time Bomb?
Baby boomer- is what the United States Census Bureau call someone born during the demographic birth boom between 1946 and 1964. The term "baby boomer" is often used in a cultural context. There were about seventy-six million American children born between the year 1945 and 1964, representing a population that is significant on account of its size alone.
In the United States, retirement income security is based on the so-called three legged stool: Social security, private pensions and other personal savings. However, due to various factors this three legged stool had some changes throughout time creating a significant issue whether the society can help as the Baby Boomer generation prepares for retirement.
Back in 1998 a report stated that boomers tend to avoid discussions and planning with regards to retirement. This factor has created a time-bomb that is about to explode. As the generation ages, commentators argued that baby boomers are in a state of denial regarding their own retirement and are leaving an undue economic burden on their children for many years to come.
The prospect of a huge generation edging unprepared toward retirement raises worrisome questions about the living standards of the baby boomers in retirement. So, has the boomer generation made adequate preparation for their upcoming retirement? The answer depends on how one defines adequate.
Preparing for a retirement living for this large number of people is not an easy task. A rule of thumb often used by financial planners is that retirees should be able to meet this goal by replacing 60-80 percent of pre-retirement income. Retired households can maintain their pre-retirement standard of living with less income because they have more leisure time, fewer household members, and lower expenses. On the other hand, older households may face higher and more uncertain medical expenses, even though they are covered by Medicare.
As a result, the retirement prospects for the boomer generation is uncertain. The policymakers and the boomers themselves may have a different reasonable objective for a retirement living. More thought needs to be given as to how to assess the adequate living standards as the retirees confronts the fact of declining health. Another thing for uncertainty is that the boomers themselves, according to the 2011 Associated Press and LifeGoesStrong.com surveys:
60% lost value in investments because of the economic crisis
42% are delaying retirement
25% claim they'll never retire (currently still working)
Baby boomers have a difficult attitude to handle although it is a fact that they can improve their retirement prospects, by reducing their current living standards.
However, this does not have to be the case for you. There is an alternative that thousands of Americans and Europeans are now taking that is dramatically changing their prospects for the future. Instead to facing decades of declining living standards and the rising costs of health care. Many boomers are now opting to move to a paradise location, where they can enjoy a luxury retirement lifestyle whilst cutting their own costs.
In 2010 International Living Magazine completed a survey of the best places to retire and nominated Ecuador as number one - and Ecuador is welcoming expats with open arms, provided they buy a property to live in or make some other form of investment in their life there. The cost of living is a fraction of that in the US and with all inclusive health insurance typically costing around $60 a month, health care concerns are a thing of the past.
The choice really is available for anyone to choose what type of life you want and what your future is all about.
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