My Personal Finance Blog

There was a colossal rise in the birth rate after the Second World War. These babies were dubbed the Baby Boomers and they are the babies born between around 1946 and 1960. This means that the first Baby Boomers became pensioners in 2011 at the age of 65.

It should be noticed that when the first Baby Boomers came of age, they produced the changes in civil and human rights and discrimination associated with 1968. They also fashioned the Hippy Movement, Flower Power and the Sexual Revolution. So what will ensue when they become pensioners?

The Baby Boomer generation is the wealthiest generation ever, but they have never felt the drop in earnings, status, health and mobility associated with older age, so it is likely that there will be some sort of pensioners’ pressure group.

About 22% of the American population are Boomers, which means that there will be tens of millions of individuals retiring over the next ten years. This has several important consequences. The first one is for health care; the mass retirement could or almost certainly will put the health care system under massive strain.

The second one is employment. Because the Boomers’ generation is the largest sector of society, when they retire, there will be a shortage of labour. After all, if the Boomer generation is the biggest portion of society, then by definition the following generation must be smaller.

These figures are roughly the same for all Western countries and it almost certainly accounts for why there is a rush in Western countries to permit immigration. Firstly, immigrants will take up the slack in the workplace and second, their taxes will assist pay for all the old Boomers.

So, with any luck, neither the state finances nor the Boomers’ health will suffer, but what other effects might this mass retirement have? Well, there could easily be a huge increase in demand for retirement homes both in one’s native country and abroad. Baby boomers are prolific travellers and many may want to retire to warmer countries or warmer parts of their country.

The southern states, provinces or counties of Western countries in the northern hemisphere and warmer countries in general, like Thailand, Spain and Italy could see a boom in retirement housing. The construction industry might receive a much needed shot in the arm.

Most Western governments and many private construction firms already have plans and even dynamic projects to satisfy this need for retirement housing when it starts to kick in. If the Boomers make a mass exodus out of the cities into the countryside or to the seaside, it could free up millions of inner city residences and at the same time make plenty of construction work outside the cities. But not just that, millions of additional jobs will be created in support and service staff positions.

The aging of the Baby boomers could be just the boost that most failing Western economies require to get back on their feet after the banking crisis of 2008-2010. Let’s hope so.

If you were to ask the first batch of retiring baby boomers what advice they would offer for planning your retirement, most of them would probably start by warning you not underestimate how critical that planning will become as you approach your retirement years. For many baby boomers facing retirement in 2011, the results of the economic recession of 2007-2008 will drastically change the way they live out their retirement years. Here’s some advice that could help you avoid the disappointment of discovering all too late that your funds are not sufficient to cover the needs of your golden years.

Undervalue Your Retirement Funds And Overestimate Your Lifespan. Inflation, recession, taxes, medical expenses, long-term care, etc. may end up eating up more of your retirement funds than you had planned for, and improved technology may help you live longer. So try to build in a cushion for the unforeseen. Recent history has reminded us that things don’t always work out the way we had hoped. Getting a job at 80 doesn’t have a lot of appeal.

Phase In Your Retirement If Possible. Practice living on a fixed income on a part-time basis if you can so that the change in lifestyle is not so traumatic. Many newly retired folks find themselves at loose ends when they no longer have the structure of the daily routine that they have been following for 40 years. Look for ways to supplement your retirement income if you realize that there simply won’t be enough to go around.

Find a way to earn more income. Creating a secondary source of income that is equal to or greater than your main source of income honors an old adage. This will ensure that if your main source of income is taken away, you will already have a backup in place that will support your lifestyle.

Many retirees will be staying at their job, or looking for a new one, after they turn 65. Those who don’t want to continue in the same arena will venture into the entrepreneurial world – they’ll start a business of their own. There are tremendous opportunities for anyone who wants to start a business in today’s global marketplace. Now is the time to take the action to put your secondary source of income into place.

Retirement gifts demonstrate appreciation and respect towards an employee or employer for the years of dedicated hard work they have put in. The nice thing about these days is that a lot of retirement gifts can be purchased online from a wide selection of websites that offer different kinds of items.

When most people brainstorm for a retirement gift idea the first thing that usually comes to mind is a watch. Timepieces are classic retirement gifts that companies give employees as a token of gratitude for the long years of service. This retirement gift somehow conveys the message that retirees have all the time they have to do the things that they have been postponing for so long to focus on work.

Not only affordable but also personalized is another retirement gift idea–signature frames. A retirement gift such as a signature frame is a true keepsake in the sense that it displays a photo of the retiree surrounded by signatures as well as messages from fellow workers and friends from the company. Fixed with an engraved plaque, the signature frame is something a retiree will be proud exhibiting in a room to remind the memories accumulated during the most productive years of his or her life. This retirement gift is highly suitable to give at a retirement party.

Travel voucher is another great retirement gift idea. A relaxing trip for two to places the retiree has been wanting to go, but did not have the chance to, is something he or she will genuinely cherish. A perfect vacation getaway is a fitting culmination activity from the daily routine at the office. Travel vouchers are easy to acquire from your nearest travel agent.

Gourmet basket is another popular retirement gift idea.The most popular item available on the internet is the Luxury Chocolat retirement gift line. These are personalized wooden boxes made of mahogany. The retiree’s name can be engraved on the brass plates that are fitted on the box, and inside the box are handmade French chocolates.

Other personalized retirement gift ideas are mementos carved or embossed with the name of the retiree, which may also include the dates of being hired into the company and of retirement. These personalized souvenirs are reasonably priced and are available to order from many websites that specialize in customized gift items. Apart from these, china gift sets, commemoration mugs, photo albums with handcrafted covers, no matter how simple a though they are can make the retiree feel appreciated as well.

There are many more of ideas to choose from on the Internet. If one really takes time, brilliant retirement gift ideas can emerge from the simplest of objects. Creativity does not only cost less, but also contributes a more personal touch on the gifts that you give to a person who is transitioning a new chapter in his or her life–retirement.

Baby boomer retirement is upon us. The 76 million Americans born between 1946 and 1964 are reaching normal retirement age in 2011. I was born in 1945 and have been retired for 16 years…it does not look rosy for the baby boomers wanting to retire. Why? Four major reasons:

1) Social Security and Medicare…both are in financial trouble…right when baby boomers are retiring…something has to give…taking 500 billion out of Medicare will not help…many doctors are opting out of Medicare due to reduced payments to doctors

2) Poor investment outlook…the stock market used to yield a reliable 7 to 10% a year…not anymore…put your money in savings…current interest rates on savings are less than 1%…no wonder 52% of all boomers have less than $25,000 in savings

3) The real estate mess…once upon a time folks could depend on home values going up and the equity used to buy an RV or cabin in the woods…In Nevada currently 80% of home owners owe more than their house is worth…many walk away from their mortgage.

4) Counting on an inheritance? Your folks are in the same boat you are…poor returns on savings and the stock market affect them the same as you

The cumulative effect on baby boomers wanting to retire is depressing. If not postponing retirement, or giving up altogether, 72% percent say they will be forced to work in retirement. That many retirees working will strain the available jobs in the popular retirement states.

The roadblocks to boomer retirement are real but there is hope. Many retirees will be expanding their retirement horizons, they include:

A) Downsizing…smaller homes cost less

B) Retiring overseas…the cost of living is less expensive than the US

C) Alternative retirement lifestyles…RVing, living on a sailboat, all fun ways to retire

D) Retire online…the virtual retirement lifestyle will appeal to many.

Being retired for 16 years we have experienced all the above let us show you how to enjoy retirement.

The Civil Service Retirement System (CSRS) began in 1920 and has given disability, survivor and retirement benefits for the majority of civilian employees in the Federal government until 1987 when the new Federal Employees Retirement System (FERS) was created. Nevertheless, over two million people carry on receiving Civil Service Retirement System retirement and survivor benefits every month.

Retirement benefits are presently financed by both Government and employee contributions to the retirement fund, and the benefits are provided based on the duration of service and the average pay over the highest three years of pay.

What are the eligibility requirements for Civil Service Retirement System benefits? An employee is qualified to retire voluntarily if the following provisions are met: at least five years of creditable civilian service; is separated from a position subject to Civil Service Retirement System coverage; is covered by Civil Service Retirement System for at least one year within the two-year period immediately preceding the separation; and meets age/service combinations of age 55 with 30 years of service, or age 60 with 20 years of service, or age 62 with five years of service.

For employees who separate from service and have met the criteria except for the age/service combination may be permitted to a deferred annuity at age sixty-two. To be qualified, the employee must not take a refund of retirement deductions upon separation.

In determining the service which may be used for an employee’s eligibility for retirement under the Civil Service Retirement System, is not restricted to service in positions subject to CSRS retirement deductions, it may also comprise service where the pay of the employee is not subject to retirement deductions, such as under a temporary appointment. Honorable active military service may also be qualified, subject to conditions: it was executed before the separation date upon which is the basis for entitlement to annuity; it is not comprised in computation of military retired pay except for certain service-connected disability requirements; if the military service was executed after December 31, 1956, some employees will have to create a deposit for the service to receive firstly or for other employees, to retain credit after the age of sixty-two.

Although the service used in determining an employee’s eligibility for retirement is typically the same as creditable service for computation purposes, there are some exceptions: periods of CSRS service refunded, will not be creditable unless a redeposit is made; if the refunded service was executed before October 1, 1990, it will be qualified even if no redeposit is made but the annuity will be actuarially decreased; non-education service is made on or October 1, 1982, is not qualified if a deposit has not been made. October 1, 1982 prior service is creditable by the annuity will be decreased by ten percent of amount owed; active military service executed after December 31, 1956 is not creditable for employees first employed in a covered position after September 30, 1982 except if a military deposit for the service is made; and unused sick leave is commendable in computing benefits. Sick leave is changed into days or months of service using the Sick Leave Chart in the OPM operating manual, but it can never be used for eligibility.