Jul 22, 2022
In today’s episode of the “Inside the Plan with the
401(k) Brothers”, host Bill Bush and Andy Bush, advisors at
Horizon Financial Group, in their ‘Generation’s Series’, talk about
the investment behaviors of ‘Baby Boomers’, the generation which
includes the birth years 1946 to 1964.
- 01:30 – In the US, the ‘Baby Boomer’ generation comprises about
70 million people.
- 03:35 - Among the Baby Boomer generation, an EBRI survey found
that 46% of this group reported accruing less than needed savings
- 05:30 - Some boomers have said that they're going to need to
work longer to pay off debt, but the actual study show, that they
don't work longer.
- 07:20 - If you wait until full retirement, you're getting 100%
of your Social Security benefit. If you wait after your full
retirement, you're getting an 8% increase each year on top of
whatever the cost of living adjustment might be.
- 08:54 - One thing that becomes important is the distribution
phase, as we go from the accumulation phase of working to retiring,
and then it's how to manage the withdrawals, which can be a tricky
- 11:15 – As you grow older, instead of just on a whim of buying
something, one needs to be a little more thoughtful of that by
understanding what is the purpose of it.
- 13:30 - If you're relying on dollars, you just don't want to
have to sell when the market drops down.
Three Key Points
‘Baby Boomers’ generation is retired right now or about to face
retirement. There are a good number that have already gone through
retirement and they've maybe gone through their planning side of
entering into retirement and then there are a bunch that are in
that decade range till they check out for the last time at the
workplace. As per the research Boomers carry an average household
debt of alittle over $272,000. And the biggest part of that debt is
likely going to be their house.
2. Some people said that due to the pandemic
they’ll just work longer and pay off that debt. But the reality is,
that often doesn't happen. The other thing that they talk about is
filing for social security, people usually make the mistake
offiling early. Filing early kind of locks in lower pay. If you
wait until your full retirement, which is 66-67.. or somewhere in
between for the Boomers group. So if you wait until fullretirement,
you're getting 100% of your Social Security benefit.
3. Baby Boomers those that have not retired,
for them the most important thing is that as you're getting much
closer to retirement you need to establish a budget ify ou haven't.
So that you understand what your spending habits are. Except for
basic needs, make sure you know where your money's going.
- “That was post-war that there was a boom in babies.” – Bill
- “Maybe some sort of debt that didn't exist the generation
before.” - Bill Bush
- “Percentage of people that say, “Hey, I'll just have to work
longer and the percentage that does is much lower because they
become ill.” – Andy Bush
- “If you want more information about Social Security, we do have
a webinar on the horizonfg
website under Events, if you want to look into that a little
more.” – Andy Bush
- “As you mentioned retiring without debt is an ideal situation.”
– Bill Bush
- “You're going to have to probably be a little better at
budgeting.” - Andy Bush
- “They want to make sure that they're not exposing themselves to
significant market drops of money that they're going to rely on” -