Happy Birthday, Boomers
Baby-boomers, turning 60 at the rate of 8,000 a day, will redefine retirement.
By Magali Rheault
May 31, 2006
Advertisement
In his 2006 State of the Union address, President Bush told his audience: "This year, the first of about 78 million baby-boomers turn 60, including two of my dad's favorite people -- me and President Clinton." Along with the current and former commanders in chief, three million Americans will celebrate the big six-oh this year and start planning the next chapter of their lives. And what a story it has been so far.
The leading edge of the boomer generation -- those born in 1946 -- were 18 when the Beatles made their U.S. debut on the Ed Sullivan Show and 23 when Neil Armstrong set foot on the moon. In 1974, they watched Nixon's televised resignation speech, and they witnessed the historic fall of the Berlin Wall 15 years later.
RELATED LINKS | |||
 |
Vanishing Safety Net | ||
|
|
Second Acts | ||
|
|
Retirement Tools | ||
Boomers' demographic influence cannot be underestimated: They represent a quarter of the U.S. population and a whopping 38% of the voting public. Their youthful defiance is forever enshrined in popular culture by their "Make Love, Not War" motto. And with annual spending power now estimated at more than $2 trillion, they're about to redefine retirement.
On the move
Half of boomers ages 50 to 59 plan to buy a new home in retirement, according to a recent survey by Pulte Homes, which owns Del Webb, the nation's leading developer of active-adult communities for people 55 and over. And unlike previous generations that stayed put, half of the older boomers plan to move out of state. Florida and Arizona still top the relocation charts, but other states, such as Alabama and West Virginia, are trying to get a piece of the action.
Many states want to attract well-off boomers because migrating retirees pay more in taxes than they cost in services. "Bringing in retirees can improve a state's economy," says Mark Fagan, a sociologist at Jacksonville State University, in Alabama, who studies retirement issues. States make their case through Web sites and brochures, pitching their low cost of living, tax breaks and amenities.
Affordable living makes good bait, but grandchildren are an even better enticement to relocate. The "me generation" has turned into the "family generation"; 74% of boomers consider themselves family-oriented, according to a recent survey by Merrill Lynch. And 63% say they look forward to spending more time with their children and grandchildren in the next phase of their lives. This often means moving, says David Schreiner, vice-president of active-adult business development for Pulte Homes.
Two grandkids loomed large in Rick and Pat Szeles's decision to move from Las Vegas back to Michigan. The Szeleses moved to Las Vegas about ten years ago, when Rick retired at age 49 from Chrysler, where he was a maintenance supervisor. But the pull of family ties proved stronger than the lure of year-round softball, which Rick enjoyed four times a week in Las Vegas. The couple recently bought a lot in a Del Webb community in Brownstown, Mich., and their 2,200-square-foot home will be ready this summer. The new house, near where the Szeleses grew up, will be only two miles from their grandchildren. "It was too good of an opportunity to pass up," says Rick, who just turned 60.
Work at play
With the average life expectancy for a 60-year-old now stretching an extra 22 years, retirement could last 25 or even 30 years. As members of the generation that has influenced nearly every trend over the past four decades, boomers are poised to take advantage of this longevity bonus. Bingo and endless rounds of golf are out of the question for much of this crowd. In fact, many experts predict that retirement will be a blend of work, leisure, education and volunteering. When asked to describe their ideal plan for the next phase of their lives, four in ten boomers say they would alternate between periods of work and leisure, according to the Merrill Lynch survey. "Boomers have reached their highest earning point in life, and they want to stay engaged," says Dr. Shereen Remez, director of membership at AARP. They want to be challenged, and work gives them a sense of fulfillment.
Many boomers expect to retire from their current jobs around age 64 and then start a new career, the Merrill Lynch survey reports. (See Second Acts to learn more.) And although four in ten people say the money they'll earn is important, 67% said the reason they want to work in retirement is to remain mentally active. About 64% of older boomers surveyed by Pulte Homes also want to travel, 25% plan to take classes and 35% want to volunteer. With so many options, can an extra decade or two be enough time to do it all?