Is It Really That Bad?

A friend passed along a link to an article at Smart Money called 10 Things Baby Boomers Won't Say and it was profoundly negative.

The list included

"Make room kids, we'll be living with you when we're old"

"and we blame you for that"

"We can't face reality"

"We're unhappy ..."

"... and we eat our feelings"

"We will bury you in debt"

Reading the list I am reminded of a quote from our friend Bill up here in Walker that I have mentioned before. Bill said "you can figure it out now or you can figure it out later but if you can figure it now you'll be a lot happier."

A lot of things on the list would seem to relate to how people make life choices and figure things out for themselves. Part of this might be learning from their own mistakes which can be a great way to learn. We all know people in their 20s who have a lot of things figured out and we all know people in their 50s (maybe older?) who are clueless.

The notion of multiple generations under one roof is not new, it was somewhat prevalent many decades ago and anecdotally appears to be on the rise due to the recent state of the economy. Michael Panzner used to write about this a lot and while I've never agreed with him on the magnitude of troubles he sees coming he was early to see this trend. Naturally this sort of living arrangement will create various forms of resentment because of the proximity. I remember a bit on CNBC earlier in the fall about new home construction catering to the need for multigenerational cohabitation.

Not facing reality is a big problem in terms of required savings rates, investment performance, safe withdrawal rates, reasonable lifestyles expense-wise and several other issues. This is behavioral and while retraining would be a huge obstacle it doesn't have to be impossible.

I doubt that the baby boomers have the market cornered on unhappiness and obesity. Eliminating related psychological issues and physical maladies these are tough things to overcome. I am happy and try to stay fit and I realize saying "you should do the same" is wildly empty but I think it is ok to make a priority out of trying to make improvements here.

The debt comment seems to be at the societal level as in the country's debt is huge a growing.

The list dwells on various types of short comings that people have or think they have. To the extent the list will create financial desperation on the part of some portion of the population it raises the idea of needing your portfolio to generate some amount of income--placing more of a burden on the portfolio. The greater the need the greater potential for taking reckless risks in order to generate some withdrawal rate that exceeds safe or taking reckless risks to make up for some sort of large decline.

This does happen and has tragic outcome written all over it. Obviously a big focus on related posts here has been about how to avoid being in this sort of predicament. My thoughts on the best way to do this have always included saving more, spending less, living below your means and figuring out how to monetize some activity you enjoy doing and would otherwise do for free--reducing the burden on the portfolio.

I'm headed out Maryland this morning for a quick ETF-related meeting tomorrow and returning back to Arizona on Thursday.