As we all know full well, the first boomers have begun hitting retirement age and will be doing so over the next 20 years. That’s the potential for millions more clients to hit the “senior” market and the target of much of your practice.
Recently, the Institute for the Future and MetLife Mature Market Institute released data from their joint study, “Boomers: The Next 20 Years, Ecologies of Risk.” The results could be very important to financial advisors who will continue to grow their business over the coming years.
“With the world focused on the collapse of financial markets, it is especially important to understand the big picture that boomers face over the coming decades,” says Kathi Vian, Ten-Year Forecast director for the Institute for the Future. “They have crafted complex ecologies of risks and resources throughout their adulthood, and they may well manage those ecologies with surprising skill and sometimes surprising innovations as they age.”
According to the study, boomers “face the widest rich-poor gap in recent generations, a global energy shortage, new economic realities and a web-based infrastructure.
In addition, boomers will have to adapt to changes in the global economy. “Faced with increasing longevity and the need to have lifetime income, boomers will likely reset their compasses,” says Sandra Timmermann, Ed.D., director of the MetLife Mature Market Institute. “An adaptive, disciplined and flexible self is the best asset that they can bring to the future.”
The study projects the following tidbits on boomers to occur over the next 20 years. Having knowledge of these changes could help you focus your practice to meet their needs:
- Family: New Relationships, New Responsibilities – Boomers will be challenged by greater distance between family members and greater responsibility for the financial well-being of children and grandchildren, contributing to slowed personal wealth accumulation.
- Global Economy: More Competition, More Collaboration – Boomers will be the first generation to age in a truly global economy, giving them access to financial products from around the world and health care abroad, dubbed “medical tourism.”
- Community: Gaps and Gains – Boomers will use new ways to build communities to close the gap created by decreased mobility, polarization, social fragmentation and health challenges. Like their younger counterparts, they will participate in online social networks, virtual retirement communities and community blogging.
- Personal: Health and Identity – Boomers will live longer, and will manage their health differently with biometrics and online tools that will challenge privacy, but will allow them to share and benefit from new information found on all parts of the globe.
- Institutions: Dissatisfaction, Distrust, Reinvention – An erosion of the trust people have had in institutions will bring new banking/investment vehicles, peer-to-peer loans and new structures to manage new capitals.