Newsletter – February / March 2006 – Baby Boomers: When are you selling?

Baby Boomers: When are you selling?

I am not a baby boomer myself, but I’ve come to intimately understand their financial concerns and objectives. I had to. When I entered the financial services industry it became clear to me rather quickly that I better get to know this important demographic if I was going to be a relevant stock broker. This is not to say that I focussed my attention exclusively on baby boomers. It simply means that I discovered early on that I would encounter them as clients more often than any other age group. What has got me thinking about them lately beyond the fact that so many will be retiring at the same is just how many have a reasonable, adaptive investment strategy.

Whether you are a professional serving this group or are a baby boomer investor the issue of a steady and deep wave of people entering retirement shortly and for the next 20 years or so presents some unique challenges to both parties. What effect on house, stock and bond prices and even private investments such as small and medium sized businesses which they own, will this mass dash for the shuffle board pad have? How will this perception, especially among members of this group, change investing behaviour in the years to come? Will just recognizing this fact, let alone holding an opinion on the strategy to employ, aid the retiring boomer?

This challenge reminds me of an apparent logical observation that many clients have brought to my attention over the years, and one that highlights a solution to the potential dilemma.