Ready or not, the youngest boomers are retiring

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In today’s big story, we’re looking at a new group of Americans preparing for retirement despite not really having the assets to comfortably do it.

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The big story

Boomer blowup

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Ready or not, the youngest boomers are retiring.

The elder generation’s final segment — more than 30 million Americans — is quitting work for good. But unlike their older peers, this group isn’t as prepared for retirement.

The majority of so-called “peak boomers” have $250,000 or less in assets, according to a recent report, write Juliana Kaplan and Ayelet Sheffey. Still, that’s not stopping many of them from retiring, meaning they’ll eventually rely on Social Security as their primary source of income.

If you’re a bit surprised by the dire economic situation of peak boomers, I wouldn’t blame you.

For a while, we’ve heard about how good things are for boomers. They own homes either outright or with rock-bottom mortgage rates. Sky-high interest rates mean they can get decent returns on low-risk investments. And they’re sitting on mountains of cash.

That might be true for elder boomers, but not everyone is as fortunate. In fact, some boomers envision themselves having to work until the day they die.

One reason for the intra-generational disconnect: pensions. Older boomers had the benefit of employer-subsidized retirement plans before a shift in the workforce left younger boomers to fend for themselves.

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Peak boomers’ retirement struggles might end up being a wake-up call for younger generations.

Most Gen Xers, millennials, and Gen Zers are in the same boat as peak boomers when it comes to taking a DIY approach to retirement savings thanks to the decline of pensions being offered.

There will be plenty of lessons learned from peak boomers entering retirement without the safety net of a pension. And things could be even worse for younger generations as Social Security could be in trouble in less than a decade.

Large economic events have already had lasting impacts on these generations, from the financial crisis (millennials) to Covid (Gen Zers). Perhaps watching a retirement crisis unfold will kickstart younger cohorts’ savings plans.

But finding the money to save won’t be easy. A growing number of Americans are struggling to just get by.

ALICEs — asset-limited, income-constrained, and employed — don’t qualify for government help but can’t afford rent and healthcare. For them, thinking about tomorrow is hard enough, let alone retirement.

News brief

Your Monday headline catchup

A quick recap of the top news from over the weekend:

A Gen Xer who got $250,000 in student loans forgiven said he can now finally start saving for retirement — and consider his dream of studying in India.

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In other news

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What’s happening today

Today’s earnings: Verizon and other companies are reporting.

It’s Earth Day.

Keep an eye out: The Lyrid meteor shower, one of the oldest known showers, will peak tonight.

The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. George Glover, reporter, in London. Grace Lett, associate editor, in Chicago.

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