Join getAbstract to access the summary!

What If Boomers Can't Retire?

Join getAbstract to access the summary!

What If Boomers Can't Retire?

How to Build Real Security, Not Phantom Wealth

Berrett-Koehler,

15 min read
10 take-aways
Audio & text

What's inside?

If everyone buys stock at once, the market goes up. But what happens when everyone sells at once and then retires?

auto-generated audio
  • 0.5×
  • 0.75×
  • 1×
  • 1.25×
  • 1.5×
  • 1.75×
1×
auto-generated audio

Editorial Rating

8

Qualities

  • Innovative
  • Eye Opening
  • Visionary

Recommendation

This book’s message is both unusual and upsetting. Author Thornton Parker questions conventional wisdom about financial planning for retirement. He draws on his varied background - including jobs in government and private sector financial planning - and discusses the influence that baby boomer retirement investments have on the stock market. He examines how the stock market creates wealth, why stock prices get inflated and who benefits. Contrary to what most experts in the investment, retirement and mutual fund industries tell their clients, Parker believes the "phantom wealth" that boomers have accumulated with their stock market investments is a time bomb. He suggests some changes, but given the greed and power he detects behind the creation of phantom wealth, his voice is probably not loud enough to make a difference. If his scenario unfolds, retirement certainly will not mean golden years for aging boomers. getAbstract recommends a look at Parker’s proposals to investment advisers, HR professionals and people planning their retirement. If he’s right, ignoring his warnings could lead to a distorted economy and increased income gaps between rich and poor.

Summary

Let’s All Retire at Once

Millions of baby boomers are approaching the age of 65 and planning to retire. When they do, they will find themselves with a limited number of income sources:

  • Direct transfer payments, such as Social Security or pension payments.
  • Proceeds from the sale of stocks, bonds, real estate and other assets.
  • Income from assets such as rents, dividends, interests, royalties, reverse mortgages or annuities.
  • Inherited money.
  • Work.

Mutual funds promoters and other professionals in the retirement industry constantly advise boomers that their stock market investments will provide them with the income they need to retire. According to the Center for the Study of American Business, the people who own more than two-thirds of all listed stocks are either saving them in retirement accounts or are currently retired - and this population is steadily increasing.

Why "Stocks for Retirement" Won’t Work

According to this "stocks-for-retirement" (SFR) model, working people buy stocks to prepare for retirement, and then sell them during retirement to supplement their incomes. But the SFR model may not be...

About the Author

Thornton Parker has more than 45 years of experience in fields ranging from computer science and intergovernment relations to policy development and transportation. He co-founded a company to help small manufacturing companies make more efficient use of their utilities.

Comment on this summary