The challenges and expectations of retirement for baby boomers

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By Hennie Bezuidenhoudt*

As Wikipedia puts it, “the Baby boomers are the generation most often defined as individuals born between 1946 and 1964, during the post–World War II baby boom. The baby boom has been described as both a “shockwave” and as “the pig in the python” – in particular, 76 million Americans were born during this timeframe!”

That’s a lot of people and little wonder that it was described as a ‘boom.’ These people today are either already in, or at least facing retirement and this article, originally intended to be just about the retirement expectations of Baby boomers, really has to be combined with a look at some of the challenges with which that they are faced leading up to that time.

The challenges and the expectations are inextricably linked, as whatever the expectations may have been, they can be moderated or even destroyed by certain challenges that may be insurmountable.

Wealth creation

It is a bit of a myth that all baby boomers are wealthy people. Certainly there will always be the wealthy amongst every generation, but in spite of the baby boomers having lived through a time of great opportunity, it has also been a time of great volatility and financial fluctuation.

If the expectation was to have retired fairly wealthy it may have been shot down by less than expected wealth creation in the long term. Baby boomers in fact have been shown to have been less astute at saving than their parents and the chances are that they will need to work longer than their parents.

A Wells Fargo study recently released shows that “working Americans of age 60 or older have median savings of just $50,000, about $250,000 short of their goal,” so even keeping their jobs longer might not be enough of a solution. In the same study, “49 percent of retired respondents said they left the workforce earlier than expected, frequently because of health problems or an employer’s decision.”

So apart from volatile markets, the worst of which we are currently experiencing as a result of the Covid-19 pandemic, many baby boomers have earned less than expected and simply planned to retire at a much younger age than was realistic.

Medical Technology

The biggest challenge is that due to the massive advances in technology, relating to the medical field, the chances are that the Baby boomer generation will live a lot longer than they had believed they would when they planned their retirement.

On average someone aged 65 (once considered to be ‘old age,’ but no longer considered to be so at all) can expect to live to well over 80. 50 years ago life expectancy for the average American, for example, was estimated to be around 70, but 50 years from now it will be well over 100.

Great expectations

In spite of whatever challenges the Baby boomers may have had to face however, many have weathered the storms and will be retiring comfortably, but their retirement expectations will be far beyond the expectations of the previous generation.

They will not settle for living in an ‘old age home,’ or even the type of retirement villages that we see today. They type of traditional stand-alone, age segregated, senior living communities of yesterday will be replaced by larger communities with great amenities, including medical care that will be a part of the whole experience.

Right now in the USA there are a number of ‘Senior Living Communities,’ far surpassing what we know as ‘Retirement villages?’ In these places experiences are everything – people want to stay active, keep learning, develop relationships and frankly, just have some fun.

This means that these types of communities are likely to be multi-generational, as they will also house younger people who are not yet ready to retire from their jobs or give up their hobbies. They have stores, wellness spas, fitness centres, medical buildings and office buildings – hotels and homes. They are not much short of a small town in one community area.

Always a silver lining

These types of communities will, for many baby boomers, be the silver lining after facing many dark clouds and investing in these areas could be your ticket to enjoying your golden years in just such a place.

• Hennie Bezuidenhoudt has more than 27 years’ experience in commercial real estate with a focus on medical offices. He is the CEO of the Benchmark Group, an international property development company specialising in medical facilitates. He is also the Founder and Chairman of OrbVest Investment Committee where he oversees strategic planning and due diligence for all property partners and proposed investments.