Boomers Will Not TOTALLY Ruin Your Retirement

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Though most of us love our baby boomer parents and want them to have a comfortable retirement, it’s no secret that supporting 78 million boomers will leave young workers--who will be taxed to fund Social Security and Medicare benefits--with the fuzzy end of the lollipop. 
 
To add salt to the wound, there is the theory that with the boomer retirement wave, we could see a drop in asset values, which would then cause the value of 401(k) plans or other retirement savings vehicles held by young professionals to plummet.
 
Fortunately, there is some good news.  A new report by the non-partisan Congressional Budget Office (CBO) has argued this won't be the case.
 
Hypothesis One: When boomers sell assets to fund consumption in retirement, the sheer size of the selloff would flood the market and depress asset values.
 
CBO says: As it turns out, boomer asset-ownership is highly concentrated, so not all 78 million will be selling at once. Additionally, there is significant evidence that most retirees actually save assets in order to leave an inheritance or hedge against the risks of large medical expenses or outliving their savings. These two factors combined make it highly unlikely that we will see an asset-selling tsunami.
 
Hypothesis Two: When boomers retire and become consumers, the demand for assets will tank, further depressing values.
 
CBO says: This, too, is false. With the growth of emerging economies, boomer demand will be made up by new, younger international buyers. In fact, China alone will more than fill the void left by retired boomers.
 
Yes, young workers still need to be concerned about the impact funding Social Security and Medicare will have on their future paychecks. But their savings and assets values are safe at least. Our parents will also probably appreciate that this is one thing for which they won't be blamed.
 
Read more stories on the baby boomer impact on young professionals at YPNation.