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Welcome to my blog. I write about managing finances so that we can enjoy our lives more. Hope you have a nice stay!

Female Baby Boomers Aren't Booming!

Female Baby Boomers Aren't Booming!

For many years now, I have been worrying about the women in my family who are from the baby boomer generation. They are struggling to be prepared for retirement. To be honest, the women in my family in that generation are simply not ready to retire. Was it just my family that had this problem? Talking with my partner, I realized that her mother as well, who is a baby boomer, is nowhere near where she needs to be in her saving for retirement. Then I did some research. As of October 2017 Kiplinger reported:

Among women ages 65 and up, the poverty rate remains nearly double that of men in the same age group.” –Kiplinger Report
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This number astounds me! Some women in my family who are approaching or are at retirement age, have only $20,000 to their name. Their net worth would be a negative number if you count their mortgage and other debts. However, they worked full time their entire life! What happened to our mothers, aunts, and friends of this generation? Why are they struggling so much?

Here are two major reasons why this is happening:

1.       Mixed messages about their roles in society:

Baby boomers were raised by women who didn’t work outside the home. They saw the example of how mom managed the house and how dad provided for the family financially. Not only did they observe this social behavior and expectation in the home, they also received that same message through the media. Movies, television shows, literature, and commercials all portrayed women as homemakers, and the man as the bread winner. Just take a look at the “Good Wife’s Guide and Advice for Young Brides”. These were the messages sent to young women. They were not encouraged to develop marketable skills, but rather to develop skills that would enable them to run a home. By the time these women were teenagers or in college, they started to see women’s rights messages appear. They started to feel empowered, and were even allowed to open a line of credit without a male family member’s approval.

“1974: Equal Credit Opportunity Act passes in the US. Until then, banks required single, widowed or divorced women to bring a man along to cosign any credit application, regardless of their income. They would also discount the value of those wages when considering how much credit to grant, by as much as 50%.” –
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Now that they are in their 30’s and feeling empowered, the former house wife life is no longer fulfilling and they can do something about it! This lead to an increase in divorce.

“The wisdom about divorce in America goes something like this: the sexual revolution sparked a sharp rise in the divorce rate from 1950 until about 1980, leading to the famous formulation that half of all American marriages would end in an uncoupling, conscious or otherwise. But in the 1980s, the divorce rate began to decline.” –Christopher Ingraham Washington Post
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Many of these women, having been raised to not focus on developing marketable skills, and most having dropped out of college or the work force to get married and raise a family, are now divorced and left with very little financially. Having never had to manage money, or plan their finances, these woman did what they knew. They went to work, paid the bills, raised their kids, and took care of family members, ALONE.

In my family, my uncle was telling me about how he had a made a mistake the first week on the job as an electrician. He said that my grandfather called him when the incident showed up on the news and asked my uncle if he knew the guy who made such a silly mistake at work. My uncle explained sheepishly that it was him who had made the mistake. My grandfather replied, “I taught you better than that!” That’s exactly the point! Father’s taught their sons trades, skills and how to manage money. My uncle is now a retired electrician, who will not have to worry about money the rest of his life. However, his two sisters, were not taught any trades or skills that are valued in the marketplace, or how to manage money. They are both going to be struggling through retirement, and will most likely be part of the women in the “poverty” level during retirement. And yes, they are both divorced along with my uncle. However divorce generally is more detrimental financially to women.

2.      Economic changes during their working lifetime:

During the baby boomer’s lifetime, many companies switched from Pension plans, where the worker didn’t have to contribute to their retirement, to self-funded 401ks or IRAs. My partner’s mother said that she expected a company pension would be her retirement plan. Her father had a pension, so he didn’t teach much in terms of putting money aside or how to navigate your own course for retirement. During her mom’s career the rules of the game changed. Companies could not maintain pensions anymore, so they switched to 401ks. It took active behavior and planning to now have a retirement nest egg. Also, gone were the days where you worked for the same company for 30 years. Jobs came and went, companies moved around, and the economy became more volatile. All of these factors, including being a single mother providing for her family, pushed her into survival mode where planning for retirement was the least of her worries.

They were also the first generation to be raised in the “consumeristic” society. From birth and ever increasingly, they have been marketed to via all sorts of media outlets. These messages told them that if they bought they would be happy. Many today struggle with hoarding and purchasing items beyond their means. This leads to financial struggles, and thus an underfunded retirement account.


What can we learn from this?

1.       Each of us are responsible for our own financial future, no matter what happens in our personal lives or in society. Always be planning ahead for the future. Even if your finances are combined in your marriage, it’s important that both partners know exactly how much there is and what the plan is to grow that money.

2.       Each of us needs to gain valuable skills and/or education to bring to the marketplace. Even if we are currently a stay at home parent, we need to be continually learning and developing skills to prepare for the day that we need to become the sole provider. The current business environment is changing rapidly and we need to keep learning in order to stay relevant. It’s important to not fall behind. There are many online courses that can help keep your skills sharp. My favorite is

3.       We all need to manage our consumption. Tracking the money you spend is imperative to your retirement future. You need to know where your money is going. I just finished balancing my February 2018 spending yesterday, and realized I had only spent $1540 for the entire month. Meaning, I was able to save a few thousand dollars this month. Once you take a look at where your money is going, you will know where the leaks are. This puts you in control of your money. It is empowering and exciting to see how much you can save at the end of each month.

What to do if you are a single female already in retirement age and have no real savings or net worth to speak of:

1.       Sell everything you can! Sell the car you have a payment on, use the equity to buy a beater for $1,000 or less. Sell your home (which usually are liabilities to most Americans) and throw any equity you have into a lower risk investment account. It’s best to talk to a financial advisor on how to invest this money. Here’s an idea, look into renting your oversized house. It may make financial sense for you to move out, downsize, and lease an apartment. In exchange, you’ll receive a check each month from your renter. You could also rent out the empty bedrooms in your home on Airbnb. This could bring in as much as $150 a night per room. Having a clean house and a hot breakfast for your guest can help you reach the higher price point. Airbnb allows you to filter your guests to keep your home safe.


2.       Kick any kids off of the gravy train. If you are in your 60’s or older, and are giving money to any of your grown and healthy children, STOP! They need to learn to swim, so stop all payments now. They have health, energy and most importantly, TIME to save for retirement. You do not.

3.       Downsize. Go through your possessions, and of the items you don’t need anymore, sell anything of value, give away or throw away the rest. This will be so liberating and empowering. This means you will need to stop going to the Dollar Store, Starbucks, and you will need to slow down the purchases of none essential items in your life. Take a moment and read Cait Flander’s “A Year of Less”.

4.       If you’ve sold your house, and downsized your possessions, you are ready to find very affordable housing. This could be a mother-in-law apartment at your children’s home, where you pay a small rent. It could be a small studio apartment that prevents your loafing children from moving back in with you. It could be moving from Seattle to Ohio, and buying a small home out right. Find a very affordable location to settle, in a house that fits your needs. This will help you keep your purchasing under control and not buy more “stuff” to put in your home.

5.       With a now downsized and minimized life, start looking for ways to earn income, and save as much of that money as possible. If your health isn’t what it used to be, then look for ways to earn extra money. Take your developed skills and work part time, be a guest blogger for a topic you are an expert in, answer phones for a startup business from your home. Babysit children, clean homes, or walk dogs. I recently met someone at my gym who told me that she made $93,000 last year walking dogs and sitting people’s pets. It doesn’t take much to find something that you can do for money that still allows you the time to enjoy your retirement years.

Women of the Baby Boomer generation: YOU’RE IN CHARGE! There is no better time than today to start making a change. The cultural norms of your time failed you. Go against the grain and take back control of your financial life.

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