Is it possible that Boomers are not spending as we used to do?
Question/Comment: Is it possible that Boomers are not spending as we used to do? I know that my purchases of clothing, food, and what is known as durable goods, are not something that I purchase as much as I used to do. Are other boomers changing their spending habits as well?
Paul Solman: Well, according to the standard theory of life-cycle saving and consumption, that certainly SHOULD BE the case. Most retirement planning software suggests that in retirement you should plan to spend something like 85% of what you did before retirement. No kids to put through college; your mortgage paid off, etc.
Me, I’m dubious. That’s because I can easily imagine Boomers spending more and more on health care: the newest drugs, the cutting-edge technologies – many of which can’t be covered by Medicare without breaking the federal bank. But then, my dad’s 99 and he costs a fortune to keep at his NYC apartment of 55 years, rent-controlled and in very modest circumstances. I have a warped view, I guess.