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10,000 Boomers are retiring daily – how this changes the banking industry and your finances
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The “silver tsunami”, or the mass Boomer retirement, can cause serious changes to our workplaces and incomes. Currently, baby boomers – those aged 65 and over – make up approximately 17% of America’s population. As they get older, more boomer generation is retiring.
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Baby Boomers are retiring in droves and so far 2024 has seen a record number of retirees. This year, for the first time, Generation X will surpass boomers as a percentage of the workforce. Recent trends may be able to predict the brevity of these changes, but ultimately, only time will tell how mass reforms will affect our economy.
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Longer life expectancy and lower birth rates
Baby Boomers made up a large part of the workforce until very recently.
According to the Wall Street Journal, fewer young people are entering the job market – this is because there are simply fewer young people than baby boomers. Birth rates have declined exponentially since the postwar boom of the 1950s and 1960s.
With low birth rates and a large number of retirees, there is pressure on social security.
“It’s a ripple effect that could basically be an elderly-induced recession,” he said. The Wall Street Journal in a video.
Without adequate changes by Congress to Social Security, mass reforms could have potentially negative effects on the economy.
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Retirees now work more
With a longer life expectancy, many boomers continue to work past age 65, which many consider the standard retirement age.
“The need for additional income is a significant factor in the decision to work beyond traditional retirement age when people have inadequate retirement savings,” said Forbes magazine in an article.
Boomers fear outliving their savings, and as noted above, with life expectancy rising rapidly, it’s clear that some may not be able to live off their 401(k) and Social Security benefits alone.
This could affect the workforce, as job opportunities that will arise for young Millennials and Gen Z may no longer be available if some retirement-age individuals decide to continue working.
Ultimately, the huge number of people retiring will create an economic shift in the coming years.
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