Boomers Aging, But Not Retiring--Yet

Demographers, one after another, report that the real crush of baby boomers in search of empty nester or retirement housing will not occur for 10 to 15 years. The baby boomers, they say, are just not ready, which is confirmed in various ways by the survey. When they were asked at what age they plan to retire, the largest number of participants (30.8%) replied "Don’t know." An additional 4.8% said "Will never be able to retire."

The demographers explain that many of this generation took a long time to "find" themselves. They began their careers later, married later and started families later. At this time, many are still very much in a family stage of life, with teenagers to send to college and often younger children right behind them. Additionally, second marriages among baby boomers are not unusual, which often means raising children at a much older age than is typical.

The study emphasizes that retirement is certainly not imminent for the largest number of these baby boom families. Rather, 38% reported that their next move would be to a bigger/better home. Another 11.6% are just now buying their first home. Only 25.1% said their next home will be for retirement, and only 17.2% were downsizing as empty nesters.

When participants were asked if they were saving for their retirement, an impressive 84.4% said yes. This, however, is not consistent with the information supplied by a legion of financial gurus who have reported, over and over again, that this is an "instant gratification" generation who live far beyond their means and who have done almost nothing to prepare themselves financially for retirement. Only those baby boomers that have enforced savings programs through their employers, the sources say, have as yet made any provision for retirement.

In response to the survey question, "What will be your primary financial support in retirement?", 47.4% said "investments." Pensions were named by 31.5% and social security by 15%. Unlike their parents, this is generally not a generation that started saving for retirement with their first paycheck. Here, too, it appears that it will be some time before the bulk of the baby boomers are able to consider retiring.

Experts have predicted that a large number of baby boomers will continue working after they retire from their present jobs, and this was confirmed by the survey. Of the 74.8% who report they will keep working after retirement, 86.4% anticipate they will have part-time jobs and 13.6% say they will work full-time at a new career. About 36% plan on having a home-based business. This is consistent with the current trend at active adult communities where, in some instances, up to 40% or 50% of residents are still working full- or part-time out of their homes.

When asked where they intended to buy their next home, 29% frankly replied "Don’t know." Others just didn’t answer, giving rise to the assumption that many have not yet given the matter enough serious thought to know where they want to retire. Those who did answer tended to feel they were likely to stay in their own area, with only 16.5% believing (at least at this point in time) that they will be relocating to another state. That’s a surprising response from a generation that has been, for much of their lives, so much into experimentation, risk-taking and breaking new ground. For their parents, staying close to home has been a primary requirement. The baby boomer generation, however, is completely different. They broke with their roots early on, going all over the country for schooling, for jobs, for all manner of new experiences. The expectation was that this generation would surely be more willing, even eager, to move to a different area for their retirement.

But this generation is full of surprises. The boomers threw out everything their parents believed in and established their own codes of ethics and behavior in every aspect of life: parent/child relationships, education, religion, sex, the arts, etc. Yet not too long ago, these very same baby boomers led the movement back to traditional values, often putting new value on the very things they had thrown away.

As they pass through the various stages of their lives, baby boomers have made it very clear that whatever it is, they will do it their way. This is likely to be so with retirement as well. One crucial question is, will they accept the concept of the age-restricted, active adult community as we know it?

The survey gives a mixed answer. In response to a question on the amenities they would want in a master-planned community, a startling 66% responded that they are not considering a home in a master plan. Yet when they were asked if they would accept a smaller lot if the home and community offered additional features and amenities, 38.2% said yes.

Only 9.5% of all participants said they would opt for an age-restricted community, with 52.4% saying they would prefer a community open to all ages and 38.1% having no preference for either one. In the sub-category of those specifically in the market for a retirement home, 19% say they would prefer an age-restricted community.

Myril Axelrod, MIRM, SHMS, president of Marketing Directions Associates Inc., New Fairfield, Conn., has been conducting qualitative research since it was first introduced into the marketing process in the early 1960s.

Also See:
Coming of Age