Unless they take action, many baby boomers are heading for a senior bust.
Many of the boomers we know have not saved sufficiently for retirement. Spooked by the last two bear markets, they took their money out of the stock market, selling off when the market was near its low point. Now they’re looking for the high returns necessary to produce the income they’ll need when they retire – yet they also want to avoid risk.
Unfortunately for risk-averse investors, there is an inverse relationship between risk and reward. Investments that offer the potential for high returns usually also carry high risk. Many investors who need high returns are keeping their money in money market funds or certificates of deposit, which carry almost no risk, but offer returns that fail to keep pace with inflation, let alone provide a real return.