Baby Boomers and the Market

[Gorilla]

Baby Boomers are getting to the age of retiring and now in the prime of their time to take out their money out of the stocks exchanges.

Since they are the largest segment of the population is there any thought that of this mass exit would cause issues for the rest of us?

[Buster]

perhaps a bit.

But the bigger inter-generational wealth imbalance exists in RE, with a substantial amount of boomer's perceived net worth tied up in home equity.

What happens to suburban, paid-off McMansions, when they all decide to downsize?

[ExtraSlow]

Agreed, I think the RE market will see a much bigger effect. One area I'm actually hoping takes a big hit is vacation properties. How many people in Invermere and sylvan lake are within a decade of being unable to care for those properties? What percentage of them will need to sell to finance the tail end of their retirements? What percentage will be sold by their kids after then are inherited?

I don't think I would be investing in recreational property for the next decade or two. Rent, VRBO, AirBNB etc for a while.

[BerserkerCatSplat]

I always find it odd that the Boomers are regarded as this monolithic group of people that all do the same thing within a 2-year span of each other.

[skandalouz_08]

I don't think there will be a mass exodus from the stock market from boomers as the low interest rate environment isn't enough for most of them to survive off of throughout retirement so they will be looking at options like dividend stocks or income producing investments.

Real estate is the trickier one when it comes to those couples that own multiple properties or have a majority of their wealth tied up in a property. However, I don't think we will see this affecting real estate prices or the number of properties for sale for another 10-20 years. My great grandparents lived in their house until they were 90, my grandma is in her late 70's and has no plans to move out for another 10-15 years unless she can't do the stairs anymore, so I think there will be some time before you see the real estate market affected by the boomers retiring.

[Sugarphreak]

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[killramos]

i know if i was near retirement and my portfolio looks the way mine does ( relatively) i wouldnt be anywhere near "cashing out" of the market lol.

Much better to work an extra couple years to cover the costs than cripple your retirement.

[roopi]

Originally posted by Sugarphreak
Bungalows are going to become very popular in the near future!

It's imminent.

[kvg]

Originally posted by Sugarphreak
Bungalows are going to become very popular in the near future!

Agreed, but the problem is the price of a decent sized bungalow when you are "down sizing" and you expect to also bank a bunch of money from your old home.

[you&me]

Originally posted by killramos
i know if i was near retirement and my portfolio looks the way mine does ( relatively) i wouldnt be anywhere near "cashing out" of the market lol.

Much better to work an extra couple years to cover the costs than cripple your retirement.

Not to mention the fact that someone doesn't just one day "retire" and immediately drain their investment accounts and sell their homes, which is how the OP came off to me.

From what I've seen, "retiring" isn't necessarily a single event as much as a process - diminished role at the company, rather than full-stop; renovate the house, rather than immediately downsize to a condo, etc etc...

[riander5]

Originally posted by Sugarphreak
Bungalows are going to become very popular in the near future!

The sales pitch!

[Xtrema]

Originally posted by Sugarphreak
Bungalows are going to become very popular in the near future!

Yeah, $500K bungalows.



Boomers are now in 50s and 60s.

From stock perspective, they still need to play because people now lives to 80s. But as they don't have job incomes, expect them to be less risky in investment choices.

From housing perspective, so far the downsizing scare has not materialize. Sure some did but I think just as many upsized. I think that won't show it's ugly head for another decade or so when they have to start with assisted living and are forced out.

[Sugarphreak]

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[Swank]

Originally posted by roopi


It's imminent.

[revelations]

Originally posted by Gorilla
Baby Boomers are getting to the age of retiring and now in the prime of their time to take out their money out of the stocks exchanges.

Since they are the largest segment of the population is there any thought that of this mass exit would cause issues for the rest of us?

Um, the mass stock market exit started happening back in 2009 after regular folk lost their investments in one of the biggest financial industry debacles in our time.

From 2009 - 2014 the DOW30 lost 75% of its average daily volume.
Were barely at the millennium year volumes right now.

This is the first time in recorded HISTORY that the DOW has consistently lost volume like this.

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