A New Era

On Thursday, June 17 at 8pm ET, a discussion on redefining retirement, especially in terms of preparing for an encore career took place. Moderated by ABC's Charles Gibson and sponsored by Merrill Lynch, the webcast featured the following participants:


Pulitizer Prize-winning journalist Anna Quindlen
Best-selling author Daniel Gilbert (Stumbling to Happiness)
Civic Ventures CEO and co-creator of The Purpose Prize Marc Freedman
Sallie Krawcheck, president of Global Wealth & Investment Management for Bank of America, Merrill Lynch's parent.

As I watched the webcast by Merrill Lynch which is owned by Bank of America, I couldn't resist the feeling that I was watching an infomercial. The stories were about people who were fortunate enough to have pensions that allowed them sufficient financial resources to retire. The point they were making with the webcast is that people need financial advisors and Merrill Lynch has them. Period.

Let's dispel some myths about the most recent recession and what caused it. Everyone who is passionate about politics will quickly point the figure at the other party. It's not a Republican vs. Democrat issue. It's a wealthy vs. middle class and poor issue. The middle class has been systematically eroded for several decades. Need proof? In the United States, wealth is highly concentrated in a relatively few hands. As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one's home), the top 1% of households had an even greater share: 42.7%. According to details drawn from the careful work of economist Edward N. Wolff at New York University (2010).

Now look at the salaries of CEO's in comparison to salaries of the average American employee. Look at the CEO compensation of the banks that looted the American taxpayers to the tune of possibly 4 Trillion Dollars! What's that? You thought the original amount was $700 Billion? CNN Money published an article which explores the possibility of the bailout costing much, much more than the original amount estimated. Next look at the salaries of our government (Republican and Democratic) officials compared to the average American employee while you're at it. We pay a lot of money for our leaders. Shouldn't they be doing a better job of leading?

The vast majority of Baby Boomers will be broke before they reach retirement age. This is by design. Do you realize that there are approximately 77 million Baby Boomers? Do you really think the wealthy people driving the economy and the world want all of these Boomers to have wealth when they leave the workforce? The answer is emphatically, NO! The wealthy want these Baby Boomers working for them until they physically can no longer work. Less money for the middle class and more money for the wealthy.

This recession was designed to shift more wealth from the middle class to the wealthy. Think about these questions: How many middle class families have lost their homes? Who owns those foreclosed homes and can sell them again for substantial profits? Who did we bail out with our tax dollars?

Let's look at the facts:

According to a new survey from Allianz Life, more than half of baby boomers fear running out of money more than death. Yet, nearly one-third say they are not too clear about what their expenses will be in retirement and 36% don’t know how long their income will last.

One in five middle-aged workers stopped contributing to their retirement plans in the last year, and one in three has considered delaying retirement, according to a new survey by A A R P, an advocacy group for older Americans
and one in three has considered delaying retirement.

The numbers, from an A A R P survey conducted last month, provide the latest evidence that the deteriorating economy and stock market are creating a less-than-golden outlook for the huge tide of baby-boom Americans surging into retirement age. This demographic, born between 1946 and 1964, numbers around 77 million people.

A new report from the Center for Retirement Research at Boston College says that the older members of the Baby Boom Generation (C R R calls them Early Boomers, those 55 to 64 years old), collectively lost 1 trillion dollars from the peak of the market in 2007 to the bottom in March 2009.

The baby boomer's stock market losses have certainly impaired their ability to retire comfortably. New research suggests that younger people may be even more adversely affected by the stock market drop because they didn’t benefit from earlier bull markets in the 1980s and 90s as fully at the oldest baby boomers did.

There are approximately 77 million baby boomers.

Workers ages 45 and over form a disproportionate share of the hard-luck recession category, the long-term unemployed — those who have been out of work for six months or longer, according to the Bureau of Labor Statistics.

Unemployed baby boomers have been dipping into their retirement accounts in order to pay their bills, buy groceries, and living expenses.

The baby boomers have less money in their retirement accounts because of the stock market crash and the unemployment situation.


Here's a question for you - Why not get out of the stock market fiasco all together? Do you realize that you have no control of your money once it's in play. What do you think will happen to all of your money tied to the stock market once the U.S. goes to war with Iran, North Korea, Venezuela, or any other country for that matter? But you say "my 401(k) is tied to the stock market". Do you realize that the Obama Administration Plans to Seize 401(k) Retirement Accounts? Take a lesson from the wealthy. Invest your hard-earned money in something that pays extremely high returns while limiting your financial risk. Take control of your money instead of letting the bankers control it. It's your retirement isn't it? Then isn't it also your responsibility?

A New Era requires a radical solution. Stay tuned to find out what the solution is and how you can be assured you will have plenty of money now as well as during your retirement.