Times they are a-changing and not for the better

For a host of reasons, some good some bad, I haven’t been blogging for a while but I am now back.

What better way to start than with a gripe, moan call it what you will. If I read another book/article listen to another conference speaker/radio programme going on about Boomers/50-plus as if they were some amorphous mass of humanity I will go mad.

The chart, research from Aviva, shows the net wealth of Brits by age group. About 18% of the 55-64 year olds have zilch – not a bean – clean broke. A further 33% have the princely savings of £2,000 – not exactly a king’s ransom. Just under 20% have more than £100,000. How on earth can you say anything sensible about marketing to people that span those on the edge of financial Armageddon and those with moderate wealth?

A few more facts. A quarter of a million Brits of pensionable age still have a mortgage – a figure that will rise to more than a million in the next 5 years.Already, over a million people aged between 55 and 64 have mortgage debts. So there you are, contemplating the end of paid income, or already in that position, trying to pay back a loan on your property and no doubt a lot of other loans as well.

UK inflation, that insidious thing that eats away at wealth, is going to remain above 2% for another 12 months at least says the man who know – the Governor of the Bank of England. What he didn’t say was that the rate of inflation for the over 60s is probably twice that figure. So even those with a few bob are going to see it reduce in value.

Interestingly, Age UK have picked-up on the inflation issue and will soon be publishing age-corrected inflation data.

This headline from the UK's Daily Mail illustrates the "50-plus are in serious problems argument": The over-50s face work till they're 80 to pay for elderly parents and struggling children.

Older Brits are not the only ones who are in a mess. Our American cousins should have a read of “The failure of the 401(k)”. How about this for an opening sentence: “The retirement security of American families has crumbled in the past generation. Workers retiring in the next 20 years can expect to receive only 65 percent during retirement of what they made during their working years, a drop of 16 percent from their parents.” And then the bad news really starts.

The relative financial resilience of the generations is a complex and confusing issue. For every doom and gloom article about Boomers I can show you one suggesting the opposite. This research from Harris claims that Gen X are the ones who are the most likely to be cutting their expenditure. Throughout Europe it is the young who are have the worst time of the recession - think a moment that in Spain 45% of young people are unemployed.

But there is a horrible truth emerging from all of these stats and that is that there will be lots, the majority, probably more than 75% of boomers/50-plus who will have a financially strapped future. That is a health warning all of us oldie market watchers should post on our musing about marketing to the older age cohort. Dick Stroud