Not too long ago all the talk was about the impending intergenerational transfer of about $10 trillion from the current crop of senior citizens to the following “boomer” generation. Eventually some analysts raised the ante to $40 trillion. With this potential windfall as a prospect it appeared that in a collective sense the boomers were going to retire in style. All they had to do was sit tight and wait.

It has been suggested that the likelihood of such an expectancy may have been part of the reason the boomers were labeled the “Now” generation. Spending was in-saving was out. For the past 20 years or so there has been expressed a growing concern that this segment of the population was dis-saving rather than accumulating nest eggs for the future.

In recent months, however, real alarm has been raised about the perceived inadequacy of retirement income for the leading edge of the boomers now approaching retirement. So the question is-what happened to the $10 trillion to $40 trillion that was supposed to start being transferred? I have not heard nor seen any recent discussion that would indicate the transfer was, in fact, taking place.

I don’t pretend to be an analyst or demographer who might shed light on the issue–but it does seem to me that there are several things that are self-evident.

First of all, the current retirees are living longer and better, so they still have the assets. Moreover, many, if not most, have shaken their worries about the possibility of a recurrence of the Depression of the 1930s, which they experienced and remember all too well. So without that worry they are spending more freely-enjoying travel and vacation homes. It is altogether likely that we will soon see a period when large numbers of both parents and their offspring will be retired at the same time. This is a compelling reason for Congress to face up to the future problems of Social Security.

There has also been some erosion of funds to be transferred. The bursting of the “tech bubble” on the stock market took its toll to the extent of several trillion dollars. True, the recent surge in stock prices has restored some of this-but not always to the same people. The recent rise in real estate prices has also increased the value of assets that are held, but much of that has been borrowed out to satisfy current desires. For the average person real estate (home) values can be tricky in terms of determining net worth. The fantasy is, you can sell your own home at an enormous profit and buy a new one that is better and cheaper. The reality is somewhat different. So long as you have a continuing need for shelter, swapping houses is seldom done at a profit-unless it is a substantial downsize.

Rising real estate prices, particularly homes, have been a mixed blessing. While the rising tide has lifted all boats and made all property owners wealthier, it has, for most part, been done without effort or sacrifice. When wealth comes easy, people become lax as far as savings go. I guess I am still a believer in the old Smith Barney slogan, “We make money the old-fashioned way-we earn it.”

The boomers, often described as “the pig moving through the python,” have caused economic dislocations all their lives. Their sheer numbers raised havoc with school districts in former years-first building new schools, then shutting them down after the boom passed on. Now comes retirement when assets, whether earned or inherited, will have to be cashed in or converted to income. Despite analysts’ views to the contrary, I can’t help but believe that the value of accumulated assets will decline, causing further erosion of funds available. When there are more people selling than those who are buying-prices inevitably fall. It seems to me that some marketing schemes today are ignoring this possibility.

A case in point is the concept of “Equity Harvesting” wherein the equity in a home is borrowed out to be put to use in more productive endeavors. Great theory, but not without risk. Actually it is not a new idea. We used to call this “Capital Transfer,” but the difference is that formerly assets were moved from investments subject to risk into guaranteed or more secure places. The theory behind Equity Harvesting is that paying off a mortgage is counterproductive. It may work for some-but human nature, being what it is, could easily upset the best-laid plans.

There is no substitute for disciplined saving starting as early in life as possible. And this I believe is one of the most important roles an agent can play in terms of the well-being of our clients. I believe in “Micawber’s Law” which holds that: “Annual income 20 pounds with annual expenditures 19 pounds six results in happiness, whereas annual income 20 pounds with annual expenditures 20 pounds ought six results in misery.”

When faced with a 45-year old prospect with no savings I often helped him face reality by pointing out that he had 240 paychecks left before the age of 65. I then asked how much he had saved out of his last month’s paycheck. The answer was always “nothing.” Then the reality was, if he didn’t change his ways, 240 times nothing would equal nothing at retirement. It was a wakeup call and it worked more often than not.

‘Tis far more noble to help create assets then simply move them around hoping to hit the jackpot.