From the May 2008 issue of Boomer Market Advisor • Subscribe!

A big reminder of why we're here

"Americans delay retirement as housing, stocks swoon," screamed a recent headline from The Wall Street Journal article, "Nest eggs shrink, deferring dreams."

Can't say we're surprised, but rethinking retirement at a time like this isn't a bad thing. The dangers of retiring in a down market are well documented. Significant losses in the initial years of retirement can devastate a portfolio from which a client will likely never recover. Do-it-yourself investors came frantically looking for professional help after the technology implosion earlier this decade; and they will again as the housing and credit crisis continues to unfold.

According to the U.S. Department of Labor, the proportion of people ages 55 to 64 in the work force rose to 64.8 percent in February, up 1.5 percent from last April. This means more than a million extra people in the job pool. The ranks of those 65 and over rose to 16.2 percent from 16 percent in the same time span -- meaning 212,000 more people, according to the Journal.

Of course, the anecdote the paper used to illustrate the severity of the problem isn't exactly the best example; it was that of a couple who, supposedly, was ready to retire before the downturn. The "Boices" had $288,000 in a 401(k) and were planning to live of the proceeds from the sale of their house -- which was valued at $290,000.

Anyone else see a problem here? Less than $600,000 for two people for what could be 30 years or longer in retirement. The story didn't mention if they had a defined benefit plan. Let's hope it's big.

Which brings us to this month's issue. We congratulate Peter Mallouk on being named 2008 Boomer Market Advisor of the Year. His adherence to the highest ethical standards, his attention to the detail, the professionalism he displays and knowledge he seeks (MBA, JD, CFP) fuels his stellar success. He represents the best of what the advisor industry has to offer, and has set the bar that much higher for the rest of us. We'll certainly need more like him in the weeks and months ahead.

John Sullivan

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