Baby boomers now represent almost 22% of the US population. However, this percentage does not show the true importance of this generation both today and in the country’s immediate future, and also for your finances in the years to come.
Historically, baby boomers have been considered the largest generation in American history. Although it is true, they have been overtaken by the millennials, but in a very different context.
To understand the importance of the baby boomers and how they will influence the immediate economy in the future, we have to start by finding out who they are and what they represent.
Who are the baby boomers?
It is a generation that is referred to globally and not only in the United States. Although this generation had indeed a greater influence in Western countries than in the United States.
Historically, the baby boomers generation started with the end of the Second World War and culminated in the late 1960s.
Therefore, Baby Boomers are considered to be people between the ages of 50 and 70, with a certain upward range in both cases.
It is widely regarded as one of the most influential generations in the country’s economy throughout history. Not surprisingly, it was the key generation in the accelerated development of economical, technological, cultural, and social models.
The name of this generation is given by the large increase in the birth rate after the Second World War.
Why will baby boomers influence your finances?
The reason is very simple to understand: it is the first generation that will have access to retirement with a much higher purchasing power than previous ones.
This translates into several important issues:
- The baby boomer generation is an active generation that will keep its influence on the country’s general economy. They will remain active consumers, but they will also have much higher expectations in terms of their income needs.
- They will live longer: the increase in life expectancy compared to previous generations is very high. Although there is no exact figure, they are estimated to live between 15 and 20 years longer. If we consider that these 15 or 20 years will correspond to a period of retirement, we understand that the influence and general economical impact of almost 22% of the country’s population will be significant.
- In many cases, they are facing an active retirement: this is another important aspect. The financial crisis of the 1990s and 2000s wiped out a large part of this generation’s savings. This, combined with higher activity and longer life expectancy, means that, for many people, retirement has to be delayed. Again we find a strong influence of this group. In this case, in the labor market, where they also bring long-standing professional experience to the table.
In conclusion, although the new generations are gradually taking control of the country’s economy, it is not possible to imagine the coming decades without the direct influence of the Baby Boomers.