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Much Planning To Do

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Open Kenneth Gronbach’s website at and some surprising statistics blast across the top of the page. Every 8 seconds, one of the 78.2 million Baby Boomers turns 60; every 9 seconds, one of the 69.5 million Gen-Xers turns 40, and every 7 seconds, one of the 100 million-plus Gen-Yers turns 20.

In his new book, The Age Curve: How to Profit from the Coming Demographic Storm, Gronbach, an author and demographer, focuses on the impact of the sizes of the various generational groups. Gronbach explains that every 20 years or so, there is a new generation created in the United States that is bound by similar wants, needs, motives and events. These include:

The GI Generation: America’s oldest living generation, made up of those born between 1906 and 1924. This group consists of 70.4 million people who either immigrated or were born in the United States. Gronbach points out that this generation amassed more than $11 trillion in personal wealth, much of it bequeathed to their Baby Boomer children.

The Silent Generation: Made up of only 52.5 million people born between 1925 and 1944 who are now 64-83 years old. Immigration numbers were negligible because of the Great Depression. “Just as the hardy remnants of the huge GI Generation gave us the false impression that we are all going to live past 100, the hardy part of this tiny generation will give us the false impression that the trend in longevity is reversed,” writes Gronbach, who notes that this generation will shut down the assisted living industry as we know it.

The Baby Boom Generation: The children of the GI and many of the Silent Generation gave birth to the Baby Boomers, born 1945 to 1964. “The ranks of the Boomers swelled to nearly 80 million, and marketers have bet everything on the abiding presence of this huge, actively-consuming market,” he writes.

Generation X: The children of the Silent and Boomer generations that were born between 1965 and 1984, numbering 9 million fewer than the Boomers, almost 11 percent less. “For every 10 jobs the Boomers left behind, there were only nine Xers to replace them. Job No. 10, often a less desirable position like fast-food worker, went begging,” writes Gronbach.

Generation Y: The children of the Boomers born between 1985 and 2010, this group will include more than 100 million. “Gen Y has an appetite for consumption that is five times stronger than its parents’ generations,” write Gronbach, who notes that over a third of them have four parents and eight grandparents. “These extended families lavish gifts on the kids. As you learn to consume, you tend to consume,” he writes.

What does this mean for financial planners? Plenty of opportunity, says Gronbach. First of all, there is an urgency to help the Baby Boomers with retirement planning. “They’ll be at the mercy of Social Security, which could easily crash. Financial planners need to turn up the heat and approach their services less as a sale, and more as an approach that they could help prevent an economic disaster.”

Gen-Xers, on the other hand, will have fewer retirement problems. “If Social Security survives, you will have a situation where the vast Gen-Yer generation will be feeding money into Social Security, similar to what we have now with Baby Boomers paying in and the Silent Generation collecting,” he said. He noted that Gen Xers are poised to do well financially since there will be fewer of them to fill jobs. “They will command good salaries, creating a great opportunity for financial planning,” said Gronbach.

The Age Curve provides ample information on how to capitalize on the changes in generational demography, and how to anticipate the needs of the various generations. For planners interested in the “big picture” and how to establish their business both now and in years to come, Gronbach’s theories provide food for thought.

Mary Scott is the co-author of Companies with a Conscience and can be reached at [email protected].


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