The United States is at a crossroads. Economic fundamentals, market cycles and demographic trends are brought together to long-term threat to economic prosperity, which we Americans are accustomed to. The combination of baby boomers through the peak year of retirement consumption, a record number of Americans and the government on how to pay, because it brewed a storm of epic times of crisis, your way of life, be damaged. You rarely see it coming, but those whoPrepared to be successful, while those who do not bear a huge financial and personal difficulties. Your financial well-being and ultimately their way of life depends on your future economic tsunami in the preparation, storm.
Very fast, the 78 million baby boomers will consume the peak year, to retire the head. This is an important moment because the United States is a country driven by consumption. Personal consumption, or what people do, as consumers,On behalf of more than 70 countries in gross domestic product (GDP) in% and how people, consumer spending, the economic health of our greatest impact. S economic boom period of development is receiving more and more Sishiwuliu-year-old population, which is the size of the elderly and to spend less time on most of the population and chest. Print for the greater number of consumers age and large groups, economic growth. Conversely, if these groups orgasmSpending in the U.S. economic slowdown significantly .....
Figure 1 & 2: the changes in household consumption at any age
As you can see charts, so that the people in a very predictable pattern of money, in their life is very easy to predict times. Such consumer behavior directly affects our economy, business and product trends. From the chips and real estate needs of all the inflation, economic growth, rates of emigration and internal migration - local, national andThe whole world is affected. By analyzing this information, we can successfully predict spending will change the next few years or even decades. Economists will continue to be "excessive," consumers are the terrible consequences of the federal government, but private consumption will continue to boom's ultimate baby boomers who bring their children to school for one year. How do we know all this? Population!
Population - the ultimate reporting tool:
The purpose of demographicThin section by age, income and lifestyle all the way to the postal code and neighborhoods near the consumers. She predicted that a new generation of consumers, if they can see the old and willing to help us, important trends that will affect the future of the coming decades. The life insurance industry is the first one to use the data to establish life insurance actuarial prediction and assessment of associated risks.
Such as population studies, can be used to forecast the stock market trendPioneering work, well-known economist Harry S. Dent, founder of a small, "Dent method" to predict the economy the way that the basic population development is the most important economic factors. Dent is predicting long-term economic development is not only documented record.
How do we see in Table 1 and 2, it was predicted that with the age thing. Between 18-47, we have to go through several stages of life. From the beginning of the work of only 18-22 years old, married22-30 years old, took an apartment acceleration cycle, the creation of new business, these new families. Shortly after the children, we are about 31-42 years, and we first-time buyers - the stage, we have created most of the debt - and the purchase of chips, is because you ate a 14-year-old house and the family had. Continue to increase our spending, because our next home, more equipment, cars, etc. to buy about 47 years ago, when our children reach their late teenage yearsAnd still living in the family.
How do we achieve the 50 children leave home. At this point, in addition to the dream car in 54 and 56 expensive wine, we began to cut spending, and debt and save more for retirement. After 50 years, we tend to reduce other expenses of our lives, in the growth of savings and investment decisions. Revenues will not fall, but the expenses would not normally. In the investment focus and usually occurs in the retirement age of 54-year-old who continues to63. Assets shortly after the peak age at death, at present with all the important things in 78 quantitative data, we when we get older, the next 20 years, the main trends - local, national and global!
Consider the following incidents, how serious, this will affect the economy of the study, but you can not!
Through this incredible obstacles and spend more? These disasters and threats of spending is not our decision. Families in needMust be provided regardless of current market conditions. Age and stage of life, in order to determine consumer behavior. How can we passed the stage of life, a move to change according to different ages, our consumption is forecasting methods. What we buy at each stage is predictable and consistent. This information can be used to predict how changes in spending the next few years or even decades. To see the actual expenditure of the population phase, we need to adjust the birth ofIndex.
Fertility and migration: the birth of the adjusted index
Cycle costs can be predicted (by promoting the fertility index for the immigrant adjustment is related) with your late forties, with a population the size of an appropriate number.
If we take the forecast year, we see more and more peaks and troughs of expenditure, fertility and migration rates in the past because of the differences (Figure 3) trends in land area of more than 40-year-old age group. For example, reducing infantOr the Great Depression than either before or after birth. Therefore, we expect 48 years later (in 1970) has fewer middle-aged people, so that stagnation第一千九百七十○
Figure 3: generation cycle - immigration, adjustment of Birth Index
When you see the table, X generation (that is, the children of baby boomers) has nearly 1 / 3 of the baby boom generation (46 years to 64 years) the size of this, we can witness a very alarming fact. , Only the body, it is not enoughIn order to maintain the pace of spending X generation, the determination of the baby boomers! To see results, we need to consumption booms.
Consumption booms
At its peak in and out of consumer spending in its consideration of the impact of waves of people. The following table shows the 47-year-old fertility shifted to the peak age of our consumer.
Figures 4 and 5: In the axis and consumer spending trends in intergenerational relationships
An economic prosperity, not only created a rise in expenditure(Demand), but also increases productivity (supply) of an effective mature generation. This will lead to higher profits and rising share of the, as well as low inflation rates. When they leave the labor market, they are replaced by less efficient labor force, resulting in a decline in productivity and inflation. The next cycle took place in squandering disappeared, leading to falling prices of goods and services, leading to deflation.
WhenA large-scale baby-boomer generation, finally his "summit will be slow consumer spending will reduce the value of annual income and the stock dropped significantly. We have seen the impact of this on the real estate is unlikely to rebound until 2012 echo wave started in 2015 to buy their first home. At present, there can not accommodate a sufficient number of people, is that this generation housing. Worse still, the baby boom generation will achieve their retirement assets, and then the sale of assets In the fall of the market, forcing them to sell more to almost the same amount of money. Add in Social Security and Medicare systems, the critical point of this expansion of retired civil servants, the Government will be forced to tax the White House no matter who is ... a perfect storm will increase.
Why are they so important?
Manage your finances, it is very important, especially in the retirement of your spending will have a fair idea. How"" Going to the demographic trends and the impact of inflation, these costs? A financing plan assumes that the rise in consumer prices looks completely different, which is stagnant or falling prices. A bond portfolio and the cash will run out of a sustained inflation period, but this is a very profitable period of deflation. On the other hand, stocks and commodities portfolio should be relatively good to keep up with the pace of inflation would be a disaster, but inIn the deflation. Of course, a viable economic forecasts, these factors are considered to build an important part of financial planning.
The most important financial decisions in the next 10 years, it, your money management style and asset allocation as part of our economic cycle approach. Choose a good, you will be able products and services that you buy at lower prices grow at the same time enjoy your savings.Choose poorly, your savings to reduce, you will see your purchasing power weakened. Real and personal perfect storm. In the ensuing bear market to lose hundreds of millions of Americans saving - is not one of them.
To be an expert ..... or lease!
Personal financial management is a serious matter. In planning the food, especially the money, you want to make the basic knowledge, and will continue to spend his life like us on this issue. With the right preparationAnd recommendations, you have in one location is a better nature of the problem, recognizing that before him to maintain or even increase your wealth is essential. In order to have a review of its own financial freedom and to ensure that you are ready to finance the huge economic and demographic changes, today, please contact me.
In conclusion
How long to confirm my clients, I am not a permanent bears, a doom and gloom and pessimism, or non-believers in the United States approach. On the contrary, IIs my 25 years of industry experience, the most optimistic. I believe that the United States is the world's largest country has ever known, and nothing to overcome our future, we do the same. Which, of course, I hope that these projections are wrong, but we can not simply random and not prepared for. The media would have you believe, the title is to expand the market, no one knows the next one "The most important of all age" of media. I know that, as long as wars, hurricanes stronger,Can peak and oil, expenditure cycle, continue to dominate the economy. When the baby boomers booms end, it is essential to their way of life, you know, investments, what to do and how to help themselves and their families, and left. As we provide our customers regardless of economic conditions are good.
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