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Retirement Planning > Retirement Investing

Redefining the retirement boom

By Philip E. Harriman

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“Men’s natures are alike; it is their habits that separate them.”
– Confucius

Complex generation. Heterogeneous group. These are not historically the titles we’ve come to associate with baby boomers. But, as various studies over the years have taught us, advisors must quickly begin to change how we view this important and often misinterpreted group. So too must we step away from our one-size-fits-all approach to retirement planning advice.

Boomers are diverse in culture, education, income and lifestyle. Retirement studies, such as one performed by Duke University in 2004, point out discrepancies in education and wage among the group that had been previously typified as the “best-educated generation.” Low wages and instability in jobs means less savings and longer working years for this generation compared to the preceding.

Perhaps the biggest takeaway is that the disparity in wealth and income is not only expected to endure, but increase as boomers grow older. The fact is, no two baby boomers are alike, which means each boomer will view retirement preparedness differently.

Boomers need advice and solutions based on their own specific financial circumstances. The oldest boomers, who turn 61 this year, may already be enjoying their retirement years, while others are in the “home stretch” of their careers. Their needs are clearly different than that of the 43-year-olds who make up the youngest end of this generational spectrum.

Consequently, age is only a tiny portion of what makes boomers unique, as those of the same age might have completely different family circumstances. One boomer in his fifties may be an “empty nester” who has lost his parents and already raised his family. Another may have kids in middle school and aging parents who require financial support.Keeping these variances in mind, advisors should also consider the lifestyle boomers seek in retirement. Some want to quit work entirely and enjoy leisure activities, while others begin to explore a vocation, versus a ‘job’ they’ve spent their entire life doing. This newfound passion may lead boomers to pursue further education or begin a new career.

Advisors who continue to deliver a uniform approach may find their traditional practices yield an unfavorably singular result. Boomers want an advisor who understands them – not someone only interested in discussing the minute details and selling a product.

Philip E. Harriman, CLU, CHFC, 2007 president of the Million Dollar Round Table, is a partner with Lebel and Harriman LLP in Falmouth, Maine. Responses and questions can be sent to [email protected].

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