What’s the Real Story for Retirees When It Comes to the Economy?
With so many stories and all the static in the daily news cycle, it’s often hard to tell the real direction of the US and global economy. That’s why we like to look at the facts, and nothing more. Here’s some recent happening in the financial and economic world that just show once more that the next recession is practically already here and it’s time for retirees to prepare now.
84 percent of CFOs surveyed think there will be a recession by 2021. The survey surprised the surveyors when so many CFOs were in close agreement that, if not sooner, a recession would be here by 2021. A global economic slowdown, however, is taking place in the United States and the Western world along with Asia.
Fewer young Americans get driver’s licenses these days. While getting a driver’s license used to be as American as moon landings and baseball, Generation Z now enrolls in later-age driver’s education and fewer go to the DMV to get that all-coveted freedom pass. With Uber, Lyft, and limited resources and income to include insourcing menial wage jobs to foreigners and immigrant workers (some illegal), the average 16-year-old American now competes heavily with men twice their age who are willing to do backflips for the same job.
Labor market supply gluts are keeping wages weak. Again, globalization reveals its true face, with many Americans later entering the workforce for jobs that pay less and offer less hours, while women joining the workforce and more than doubling the labor market in massive amounts of immigrants, driving down labor prices since the 1970s.
Real Inflation Could Eat Away More than Just Retirees Fixed Income Distributions
Actual (unofficial) inflation and CPI are actually around 7-10%. The government has consistently changed the way it keeps tabs on metrics such as inflation and the CPI (consumer price index), even going so far to ignore the cost of basic goods because, at the end of the day, the Federal Reserve is not there to do anything but protect the global banking elite and keep Wall St looking good.
Millennials can’t afford to buy homes, have too much debt and not enough good jobs. With a shortage of good jobs, millennials graduate university with enormous student loan debt that many will never be able to reimburse working a “normal” job. I once met a restaurant worker who told me she had over $100 K in student debt when I waited for tables. When I heard that, I almost collapsed and she said it as casually as you might ask for a napkin at lunchtime.
With 10,000 people becoming 64 each day over the next few years, a baby boomer will benefit from being mentally and psychologically prepared to protect their investments, 401k and IRA as long as they can. Ensure that your investments are more severely divided into lower risk assets once you leave the workforce.
Whatever You Do to Protect Your Retirement, Do Something to Protect Your 401K or IRA!
With savings accounts not even paying enough to break inflation, American retirees are going to have to come up with a strategy to have enough money for retirement, whether they like it or not. The good news is, there’s still time. The bad news is, time’s running out!