The last thirty years of increasingly more reckless financial policies, behaviours and capital allocations have come at a bad time for baby boomers.
Low savings rates, boom-bust asset cycles, expensive housing, fewer guaranteed pensions, low yields and rising insurance costs, along with cash-strapped kids–all have made finances tighter than hoped, for most.
Now aged 55 to 75 years old, all are nearing the age when most were expected to retire and within the final 1 to 3 decades of their expected lifespans. Financial loss-tolerance is low and time is of the essence.
For the economy overall, this suggests lower spending from the consumption sector that has driven about 60% of Canadian GDP over the last decade. Capital investment from business and government will need to pick up slack with a focus on improving the efficiency and productivity of resources so the population can spend less and benefit more.
Rick Lowes RBC’s VP of Retirement Strategy discusses with Financial Post’s Larysa Harapyn. Here is a direct video link..
;
