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Why aren’t baby boomers retiring?

From 1946-1964 there were over 70 million people born in the United States. This generation of Americans is affectionately referred to as the “baby boomers.” They are stereotypically known for their leadership abilities, passionate work ethic, and strong interpersonal skills – not to mention a penchant for talking about how all millennials are lazy. This group has produced some of our country’s most famous and most infamous personalities, including Oprah, George Clooney, President Donald Trump, Bill Gates, and – a personal favorite: “The Terminator” Arnold Schwarzenegger.

Baby boomers are many different things: They’re parents, spouses, CEOs, community leaders, teachers, sports fans, and often the narrators of some of the long stories. But it’s what many of them are not that’s catching the attention of the business world… They’re not retired.

So why are these innovators, executives and business owners working well into their late 60s, 70s or beyond? The answer may be obvious if you understand the generation that prides itself on core values stemming from a strong work ethic. The chart1 below demonstrates some of the characteristics of the last century of generations:

 

Traditionalists Baby Boomers Generation X Millennials
Birth Years 1900-1945 1946-1964 1965-1980 1981-2000
Gen Nicknames Moral Authority “Me” Generation Gen X Gen Y; Echo Boomers
Key Attribute Committed to Company Ability to Handle Crisis Work/Life Balance Ambitious, but Not Focused
Work Ethic Pay Your Dues 60-Hour Work Week Work Smarter, Not Harder What’s Next?
Views on Money Pay Cash Buy Now, Pay Later Save, Save, Save Earn to Spend
Core Value Family/ Community Success Time Individuality

 

As the chart illustrates, baby boomers are often characterized as being driven by success. And their idea of success doesn’t hinge on a 40-hour work week.

Demographers have frequently likened the baby boomers’ social effect to that of a pig moving through a python1 because this large population segment shaped so many aspects of the country as it progressed. In the ‘50s, birth rates drove the need for hospitals, diapers, teachers and children’s toys. As the ‘60s and ‘70s arrived, these children started to drive, purchase soft drinks and eat at McDonalds’s. Thus, fast food franchises flourished. Throughout the ‘80s and ‘90s, baby boomers pivoted their focus to young adulthood and raising a family. During this movement, the housing market exploded, and the world once again changed due to the influence of the boomers. Simultaneously, the economy buzzed along into another decade, and some of the brightest of the baby boomers introduced the internet and mobile phones. Many female baby boomers who were entering the growing workforce at this time also helped create the need for more daycare centers.

Unfortunately, the later 2000s brought struggles as the dot-com crash, housing bubble and 9/11 occurred. These events caused baby boomers to position themselves in the political sector, as they hoped to affect change on issues of healthcare reform, social security, long-term care and national security. Recent history seems to strongly suggest that, as the baby boomers evolve, so evolves society.

Baby boomers continue to play a large part in the business world through their core values, work ethic and refusal to retire. This refusal is their prerogative, but it also has repercussions for not only their employees, but also the individuals and industries of their customers, vendors and communities. It’s apparent that the decisions baby boomers make impact many others.

Many baby boomers (unlike most millennials and Gen Xers) do not want to enjoy the free time that comes from retirement or have more time for their hobbies. Baby boomers tend to tie their identities to their careers. Thus, retiring or selling a business, for them, can be difficult.

In fact, Exit Planning Institute statistics show that 75 percent of baby boomers regret selling their business 12 months after closing.

Baby boomers aren’t retiring because they don’t want to and there’s nothing anyone can do to make them. The only things we can do are accept the situation and adjust our perspectives. In our next article, we will explain what 2nd Generation plans to do to assist its clients as they come to terms with this trend.

Please check back for follow-up articles on this topic, including:

  1. What is 2nd Generation Capital doing about the baby boomers’ refusal to retire?
  2. What are some problems that will come from the next generation of business owner?
1 Derived from Chris Snider’s “Walking to Destiny”

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