Demographic Changes or Buy The Right Stock?

In 3000 days, about two-thirds of the now-working population will be 60 years old or older.  We know this with certainty.  That only leaves one-third of the now-working population to pay for all of the government social programs like medicaid, medicare and social security.

Let’s ask a few questions about our future.

What about money flowing into the stock market?  If you take a look at the history of the market you would see that it is like a teeter-totter.  It goes up then down over and over.  From 1980 to 2000 there were only 4 negative years…Strange?  What could have caused that?  Maybe it could have been that 401ks were introduced in the early 80′s and the baby boomers were throwing a lot of money into them.  So what about the next 10 years?  There will be more money coming out of 401ks than going in due to retiring baby boomers.  So could the market go the opposite way in the future?

Haven’t we always been taught to start selling our stocks and going into cash as we get closer to retirement?  How might that then affect the stock market?

What about all the baby boomers selling their 5,000 square foot homes to down size into condos?  How could that affect the real estate market?

There are a lot of things we should consider about the future changes of our demographics.

We should get away from traditional thinking i.e. (Buy the right stock at the right time.)  We need to realize that the biggest impact of our financial futures will be the changing demographics on our country.

Here is an interesting news clip about the aging population…

http://cosmos.bcst.yahoo.com/up/player/popup/?rn=3906861&cl=10749765&ch=4226723&src=news