To try everything Brilliant has to offer for free for a full 30 days, visit https://brilliant.org/patrick/. You’ll also get 20% off an annual premium subscription.
Over the next five years the largest cohort of the baby boomer generation will reach retirement age and while it is broadly assumed that they will have comfortable retirements, a recent analysis of their assets shows that more than half of this final group of boomers are not financially prepared to retire whatsoever.
In today’s video we look at how American retirees found themselves in this position, and how much you need to save to have a comfortable retirement.
Patrick’s Books:
Statistics For The Trading Floor: https://amzn.to/3eerLA0
Derivatives For The Trading Floor: https://amzn.to/3cjsyPF
Corporate Finance: https://amzn.to/3fn3rvC
Additional Reading:
While America Aged by Roger Lowenstein: https://amzn.to/4fLLZ45
Peak Boomers Paper: https://www.protectedincome.org/wp-content/uploads/2024/04/Peak-Boomers-Econ-Impact-Study-ALI-RII-Shapiro-Stuttgen-EMBARGOED-Apr-18-2024-041924.pdf
Fed Survey: https://www.federalreserve.gov/econres/scf/dataviz/scf/chart/#series:Retirement_Accounts;demographic:agecl;population:4;units:have;range:1989,2022
Private pensions in the United States: Gambling with retirement security: https://www.cambridge.org/core/journals/journal-of-social-policy/article/private-pensions-in-the-united-states-gambling-with-retirement-security/F6599767174900C76CF00146B9F295C4
Ways To Support The Channel
Patreon: https://www.patreon.com/PatrickBoyleOnFinance
Buy Me a Coffee: https://www.buymeacoffee.com/patrickboyle
Visit our website: https://www.onfinance.org
Follow Patrick on Twitter Here: https://twitter.com/PatrickEBoyle
Business Inquiries ➡️ sponsors@onfinance.org
Patrick Boyle On Finance Podcast:
Spotify: https://open.spotify.com/show/7uhrWlDvxzy9hLoW0EYf0b
Apple: https://podcasts.apple.com/us/podcast/patrick-boyle-on-finance/id1547740313
Google Podcasts: https://tinyurl.com/62862nve
Join this channel to support making this content:
https://www.youtube.com/channel/UCASM0cgfkJxQ1ICmRilfHLw/join
49 Comments
To try everything Brilliant has to offer for free for a full 30 days, visit https://brilliant.org/patrick/. You’ll also get 20% off an annual premium subscription.
Sounds like they need to pick themselves up from their bootstraps.
Lol "A national retirement scheme" a great way to describe social security. Although "National Retirement Scam" would be better.
So, lets say my retirement fund is tied to the stock market, and there's a stock market crash. Should I continue to eat organic so I can make someone a good meal when we throw spears at each other?
How about selfish self-entitled homeowners thinking that others are OBLIGATED to pay them MORE for their homes than THEY paid for them? NO OTHER USED object in the world, like a used car, sells for more than it was purchased brand new.
Unions are based. F**K you
The period of time whereby you could have a giant home in NYC while working as a bag clerk at a grocery store making a little over minimum wage and have 7 kids is over. That was more of a historical outlier due to the rest of the world being in ruins after 2 world wars and/or either developing or entering the initial stages of development after bloody fights for independence. The only reason American's had it so good was because it was virtually the only stable place on the planet. And fact of the matter is America is still one of the best places on the planet. It's not as good as it was before, obviously. But that's more because that was the exception, not the rule.
My parents were literally living in jungle encampments with no electricity or running water or roads in the 80s. I now live in waterfront property with an income into the 200k USD range. That is not the norm. But that is not a shock or unusual for America.
Pensions aren't the problem. Not prefunding benefits is.
It's mostly generation X people who have suffered by the end of defined benefit pensions, not so much boomers.
I like how the Renault shown at 13:10 has a German license plate
You've got to love all the Union bros who can't stand the truth. "Demanding companies fork over ever increasing fixed costs regardless of business conditions can't be hurting businesses!"
They need to die already Jesus Christ
Let's also not forget a good portion of boomers are also not in good health either. 😢
Americans are really a joke when it come to social safety net like pension, healthcare or workers rights
I love this channel but because I know a lot about this topic it seemed so slow.
Eh saying 6 percent was over 60 isn't saying nothing for the survivability as our population was still growing exponentially in General
even worse in my country (s.korea) large aging population + lowest birth rates ever!!
Just save up 7 years of income bro Xd just set it aside lmao it ain't hard
Your whole life you’ve been sending every spare penny to the most corrupt institutions in history, watching while these greedy parasites keep getting richer and richer… now you expect them to send your ‘invested’ money back to you.. with interest.. good luck with that..
Look at how much time and effort they put into minimizing the amount they pay out in taxes.. they’re going to match that effort to not pay beneficiaries.
And aren’t these retirements tied up in stock market investments.. when they start cashing out retirements and pulling money out of the stock market, isn’t that going to decrease the value of the stock. Which will decrease the value of their investments and the market.. the stock market is propped up by the investment money in it.. so when the biggest generation in history starts pulling money out of the stock market instead of putting it in.. I wonder what happens.
Reagan blew up Defined Benefit pension plans
8:39 $200/mo in 1935 would be $4591.82 in 2024, for an annual pension of $55,101.84.
21:47 I don’t think labor unions are to blame since as you said the first idea was wages which would’ve also fixed the issue but were fought and denied so they used their second best option which was pushing the deadline for the money that the workers desired further back, which is emblematic more of capitalism (our health, our food, the planet, then the workers although the example of 25 years subway worker to early retirement is not the answer unless done fully
Have you taken a look at the mortality data since 2021? I have and it’s quite alarming. People are dying off at scary levels, heart attacks, blood clots, organ failure and turbo cancers. Make sure you factor in that many folks won’t be collecting social security or a pension
I still can't fathom how a company could keep paying an employee long after they retired. I've lived in a work by the hour world my entire life.
If I'm not working, how can my company be earning?
Partly why I don't want to be immortal or live beyond the age of 80
People just aren’t even trying to save. Boomers have no excuses.
Most usa citizens are stupid…the illegals know that.
America's time bombe….from China to Russia to every Western nation: the demographics are disastrous.
The normal people ca't no longer have children for the !5 took too much from the pie.
No matter if the elite of the CCP, Russian Oligrachs or the super rich: we want more.
He felt a strike against the corporations was a strike against the government. Do you see who his bosses actually are.
30 years of stagnating wages what did anyone think would happen.
20:33 and they all moved to Florida where NY can't tax their benefits to recapture some of the costs of the subways.
If people want to know why America has been on slide down on prosperity
since 1999 just look around. You cannot decide to "move in a new direction"
and wonder why things are getting bad with crime, wages,and security.
The recommend saving rates to have set aside assumes one has no pension? or with a pension?
Let 'em take it on the chin, they have a lot to answer for.
8:55 Dr. Francis Townsend, prefiguring Social Security
Communism is good.
They had 40 years to get their crap together. I don’t feel any sympathy for them. I know many boomers at work almost 70 that still making mortgage payments and some have never owned a house or not even have a 401k. Don’t let these people guilt trip you over their mistakes in life.
This is why Social Security should be dissolved and everyone get their money back. When instated, the average maximum lifespan was 65, Liberals expect it to work as intended, but want to make things worse by actually reducing retirement age. That doesn't consider the other core flaw of the system, that one generation pays for the next, meaning vast differences in population size between generations like with the Baby Boom breaks the system as well.
Also, people have no excuse, IRAs are not new, and especially not Treasury Securities. The newer generations, especially, even while financially struggling, can invest thanks to stock apps, fractional shares, round up programs, etc. I'm a big fan of the new synthetic covered call ETFs, too, for income, and just using naked puts to insure them.
So the bottom line is that no form of capitalism can guarantee a safe and secure life for an average Joe.
Earlier froms were doing it for a while and now are at the verge of bankruptcy.
Newer forms have made the cost of living so high and employment and good income so scarse that it's impossible to have a balanced ordinary life let alone saving for the retirement.
I wonder if the modern capitalism generated so much wealth, where does it all go? Does it end in the hands of a few or the huge wealth was a myth?
Also, The savings guidance is basically worthless and shifting all of the burdens to ordinary people who have no say in the macro economic decisions is just another ploy to oppress the anger of the masses.
So to sum up, the message is: sorry the system is inherently designed to extract wealth for a few and leave the rest poor and there's nothing you can do about it so you'd better shut up and subvert to your corporations who give you menial jobs and laughable incomes.
Nice.
Let’s also not forget the fact that in just less than 9 years the Social Security and Medicare trust funds will become insolvent and senior poverty in this country will double overnight. That is unless the federal government can correct its problem with overspending
Good.
The reality is that none of it happened in a vacuum. It's easy to say unions drove these companies into insolvency, but you can just as easily say that corporate greed drove those agreements, as they either radically failed their due diligence, assumed they would just keep growing forever, or merely passed the buck when it came to financial management of their balance sheets. Either way it's entirely as much the corporate boards' faults for allowing deals that would leave them financially crippled to pass.
It seems likely that they thought, as you mentioned, this is a great deal because we won't have to pay for this until they retire, these unions are suckers and we're getting them back to work on the cheap with no new wage hikes.
35 years @7% growth?????? WHERE!?
6:00 it was at that time they learned.
Great vid! Nothing to be done about it though because a social safety net is communism. Maybe the free market will help us. ❤
I guess millennials were the first wave to realize we couldn't afford homes, and peak boomers will be the first wave to realize their retirements are shit. Both firsts of many generations to follow, if no interventions come. Boy, isn't being first just grand??
Thanks boomers
Unions are necessary but they often end up divorced from their employer survival.