When we study economics and consumer spending habits, we see a direct connection between economic cycles and life cycles. For example, Americans spend the most money when they are between the ages of 40 and 50. One of the problems with our current economy is that baby boomers – those born between 1946 and 1964 – are on the downside of their greatest spending years. Instead of spending money right now, they are saving.
Saving is, of course, a good thing but our economy is based on spending so when a third of our working population stops spending it directly impacts the stock market, housing, employment and other critical aspects of the economy. When spending slows, jobs get cut, bankruptcies and foreclosures increase and the cycle snowballs. If this trend continues – and it is likely to as our population continues to grow older – our country could face a recession/depression for as long as a decade.
How does this situation affect you personally? That depends on your finances and additional factors including your age, goals, current assets and more. To prepare yourself for what comes next, you need to question the old ways of thinking and plan for your future now. And, of course, if you want help with that, I am happy to provide an initial consultation free of charge. Just contact my office to set up your complimentary appointment today.
Scott K. Warner
Life Design Financial
Values-centered financial planning for the future