The New Boomer Retirement Plan: Crash Pads?
source: http://www.marketwatch.com/news/story/new-boomer-retirement-plan-crash/story.aspx?guid=%7B14...
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- geneonlbk
- added this
The commune of the 1960s may be making an unwanted comeback thanks to the bursting of the housing bubble, says California investment expert and author Thomas C. Scott. In a possible sign of things to come, Scott says he's noticed that a growing number of people facing foreclosure or bankruptcy are doubling up in the middle-class version of crash pads. And he expects the trend to grow as more and more baby boomers face under-funded retirements.
Scott, CEO of Scott Wealth Management and author of the forthcoming "Fasten Your Financial Seatbelt," says that at the epicenter of the housing collapse, Orange County, "I'm hearing a pattern of stories about people caught short with maxed-out mortgages, big houses that won't sell, and eroding incomes who are throwing in the towel and sharing homes with others."
In one case, Scott says a family moved in with friends so they could rent out their own home in an effort to save it. "A retired neighbor of mine recently took in her son, daughter-in-law, and grandkids because they couldn't afford their own home anymore."
Scott says this may prove to be a major demographic shift as baby boomers swell the retirement rolls.
"Baby boomers as a group have failed to adequately save for retirement. Although every study suggests people expect to work past age 65, they won't be earning what they did during their peak years. Millions will reach retirement age with Social Security, Medicare, and whatever work they can get."
Boomers are getting squeezed from both ends, he says. "They loaded up on mortgage debt during the good times, and calculated their retirement assets based on inflated home prices. Now all that paper wealth is gone, they're stuck with white elephants, and the end of their peak earning years is in sight."
Scott says the housing bust could be lengthy, and painful. "The collapse of the 1980s took seven years to work itself out. In the next seven years, some 30 million boomers will reach retirement, many unprepared."
Scott, CEO of Scott Wealth Management and author of the forthcoming "Fasten Your Financial Seatbelt," says that at the epicenter of the housing collapse, Orange County, "I'm hearing a pattern of stories about people caught short with maxed-out mortgages, big houses that won't sell, and eroding incomes who are throwing in the towel and sharing homes with others."
In one case, Scott says a family moved in with friends so they could rent out their own home in an effort to save it. "A retired neighbor of mine recently took in her son, daughter-in-law, and grandkids because they couldn't afford their own home anymore."
Scott says this may prove to be a major demographic shift as baby boomers swell the retirement rolls.
"Baby boomers as a group have failed to adequately save for retirement. Although every study suggests people expect to work past age 65, they won't be earning what they did during their peak years. Millions will reach retirement age with Social Security, Medicare, and whatever work they can get."
Boomers are getting squeezed from both ends, he says. "They loaded up on mortgage debt during the good times, and calculated their retirement assets based on inflated home prices. Now all that paper wealth is gone, they're stuck with white elephants, and the end of their peak earning years is in sight."
Scott says the housing bust could be lengthy, and painful. "The collapse of the 1980s took seven years to work itself out. In the next seven years, some 30 million boomers will reach retirement, many unprepared."
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AntiFacistCanuck
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Look to the Cubans, no not the basket cases in Miami, but real Cubans, the ones who who know how to survive major hurricanes, how to look after each other, how to engender hope and enthusiasm in their communities in times of crises.
The Cubans have survived much worse than what merica faces, mericans should be chartering boats and planes to go over to the island, first to see what government is supposed to do for people, and second learn how to do it.
Spare a thought for the First Nations, visit a reservation anywhere in merica and open your eyes.
- 3 years ago
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AntiFacistCanuck
