Nothing is as bad as it seems. We’re not in a new normal, modern portfolio theory failed from the get-go and—despite oceans of ink dedicated to the premise—baby boomers, far from finding themselves in crisis, are the best retirement savers in history.
I’m now waiting for Morpheus to inform me of the matrix.
Michael Finke’s presentation at FPA Retreat 2013 in Palm Springs, Calif. wasted no time in surprising the advisors in attendance.
“Baby boomers have saved more money for retirement than any generation in history,” Finke, a professor of personal finance at Texas Tech University, said at the outset of “The New Retirement Reality.”
The speaker, a regular contributor to IA’s sister publication Research, said that any talk of a retirement crisis is “a bit overblown.”
He acknowledged that older baby boomers have saved less than younger baby boomers, and that Generation X is on track to save more than younger boomers, even accounting for the poor asset returns experienced by the former.
“And despite the conventional wisdom that it’s only getting worse, there were 40% more assets in defined contribution plans in 2012 when compared with 2005,” Finke argued.