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Friday October 13, 2006

Boomers about to explode on the retirement scene

by amy denney
copley news service

The day of reckoning has arrived. Baby boomers are reaching the age of 60 this year. Experts in gerontology have been making predictions about this period for decades.

Will boomers retire in droves, drying up the work force? Will they exhaust resources? Will Social Security survive? Will they get the pensions they’ve been promised? Does this year mark the beginning of a “demographic tsunami,” as described by David Walker, U.S. controller general, or is this an era of unprecedented promise?

Will boomers in their retirement years be a blessing or a burden? Opinions often come down to two factions, says Carolyn Peck, assistant professor of human services/gerontology at the University of Illinois at Springfield. Most people — including experts — believe either the country is “going to hell in a hand basket” or it will experience unprecedented opportunity, she says.

There were 78.2 million baby boomers as of July 1, according to the U.S. Census Bureau. Boomers are defined as being born from 1946-64. Nearly 8,000 people will turn 60 each day this year. That’s 330 people per hour.

Peck says there will no doubt be some difficulties that communities and the country will face.

A major issue is life expectancy and health care. People who are 60 have an average life expectancy of 81.6 years, according to the U.S. Centers for Disease Control and Prevention.

Even the gap between a man and a woman’s life expectancy is narrowing, Peck says, likely because work is less physically demanding overall. Other factors that have had an impact on life expectancy, she says, are health prevention and medical evolutions, particularly the treatment of heart disease.

Some boomers in their 50s have toddlers at home, and they aren’t their grandchildren. They simply had the option to start families later in life.

Many boomers have had more than one career over their lifetime. Some are financially secure, particularly compared with their parents.

More women worked among the boomers than previous generations. More boomers never married and/or never had children.

What the last example means, Peck says, is that they may lack a support system.

“Caregivers are often children. Who’s going to fill that void?” she says.

Is this country prepared for the health care challenges posed by boomers?

The oldest among them can take early retirement starting in two years. Those covered by Social Security will grow from 47 million to 69 million in 2020. By 2030, the Congressional Budget Office projects that Social Security spending, as a share of the U.S. economy, will rise by 40 percent.

There’s a fear among boomers that the “promise” of Social Security won’t be kept. And Peck says it’s not unrealistic to think that even the most secure pension plans could erode.

“There are individuals that could end up being poor for the very first time,” she says.

Some boomers take a more optimistic approach.

“I don’t think the boomer generation is going to quite roll over and say, ‘This is the luck of the draw,’“ says Lawrence Johnson, 59, of Springfield, Ill.

He predicts that boomers will fight for what they perceive are their rights, and that their innovative nature will kick in and develop creative solutions for the problems caused by their growing older. Many prefer the “glass half full” approach, Peck says.

Civic Ventures, a think tank on aging, says the baby boom generation will create new assets in the form of unprecedented human capital. “In short, there are more people with experience who have more time to use it. And many have a personal determination to contribute,” the group says on its Web site. “When this impetus finds the right vehicle — and people engage in pathways that bring about greater good — a return is generated.”

The dividend payout is twofold, Civic Ventures says, benefiting society, as well as those who volunteer. Many organizations are already reaching out to boomers, such as Big Brothers/Big Sisters and Habitat for Humanity, seeking their experienced backgrounds.

“What a wonderful volunteer resource they can provide, especially intergenerational,” Peck says.

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