Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page >> News >> Story  Disclaimer 
Latest Headlines

Gold Seeker Closing Report: Gold and Silver Edge Lower While Stocks Gain
By: Chris Mullen, Gold Seeker Report

Gold Resource Corporation Declares April Monthly Dividend
By: Gold Resource Corporation

Jack Chan's Weekly Precious Metals Update
By: Jack Chan

Earnings: The Big Sucker Play
By: Clive Maund

GoldSeek Radio Nugget: Chris Powell and Chris Waltzek

Have You Not Yet Learned - Just Buy The Dip!
By: Avi Gilburt

Camino Continues to Expand Adriana Zone with Northwest Step Out Drilling
By: Camino Minerals Corporation

When Investor Psychology Turns Dark, All News Is Bad News
By: John Rubino

Gold Price Increasingly Influenced By Declining Dollar Rather Than Interest Rates
By: GoldCore

Gold Seeker Closing Report: Gold and Silver Fall Roughly 1%
By: Chris Mullen, Gold Seeker Report


GoldSeek Web

"For the Baby Busters, It's Downsize or Die"
By: Richard Benson, SFGroup

-- Posted Tuesday, 29 June 2010 | Digg This ArticleDigg It! | | Source:

Living realistically is not something anyone wants to do in an election year, and it may be especially difficult for the Baby Boomer generation to grasp, along with their children.  Over the last two decades as wages swelled, and job prospects were unlimited, the Baby Boomers became accustomed to living well beyond their means.   Moreover, if money wasn’t coming in fast enough, there was either a stock market or housing bubble to tap into to keep spending alive.  Even condominium buildings were built and given names with this in mind.

A high-rise condominium completed around 2005 in Boca Raton, Florida, was named “Luxuria”.  Models are lavishly decorated with names like “Milano” and “Toscana”.  The project back then was marketed as “a gem and one of the most spectacular preconstruction projects in Florida”.  One ad even claimed it would be “an exceptional privilege” to live there. 


The last time I drove by the “Models Open” signs were flapping in the wind, many units remained unsold, and prices were slashed (still extraordinarily expensive) with no buyers in sight.  My research also indicates that well over one-half of the units are still owned by the developer.   

American Boomers thought that the future would always bail them out, but the future is here and the house is upside down, the credit cards are maxed out, and job stability has vanished.  The prosperity they thought they had achieved was only a fantasy and the Boomers have now become the Baby Busters. 

When you actually sit down and examine the cost of living these days, the nickels and dimes can add up real fast.  After paying for food, phone, cable, electricity, newspapers, maintenance, gas, taxes, and insurance, most of us are left with only pennies.  Also, a healthy lifestyle – gym memberships, organic fresh fruits and vegetables – is beyond reach for many creating a frustrated society where diabetes is fast becoming a pediatric disease.  It’s no wonder fast food restaurants continue to thrive as they cater to the masses; they’re inexpensive for sure, but the food can make you obese and send you to the emergency room.

Surprisingly, the Boomers remain in denial and disbelief that the party is over, but perhaps not for long.  How can they vacation in Europe or buy that house in the Hamptons when their utility bills and property taxes are eating them alive, as they search for work?   Evidence suggests that the behavior of the Baby Busters may be evolving from being frozen like a deer in the headlights, to slow capitulation of letting go of the old lifestyle. Slowly, the second and third home that can’t be rented out is being sold or simply abandoned because it’s underwater.  The first home, a huge McMansion, is being swapped for a more affordable place one-third its size.  Not even the very rich can afford to heat or air-condition a place the size of a small hotel, and the Baby Busters are realizing they desperately need to be saving for retirement rather than spending into oblivion.   

As my wife and I watch these events unfold before our eyes, we both feel fortunate not to have fed into the frenzy.  We never really upsized, perhaps because of our upbringing, but our parents had common sense and a strong work ethic which fortunately rubbed off.   More likely, though, it’s because my wife and I both lived for decades in Manhattan where the cost of living is extraordinarily high.  An average two-bedroom 2-bath apartment there could cost a whopping $1.5 million or more, without a great view.  This price point is way beyond the cost of a modest apartment of the same size on the island of Palm Beach, yet we get free parking, a stunning view, and a swimming pool.  By focusing on keeping the monthly expense “nut” down and having the old-fashioned attitude that if you can’t buy it for cash, you shouldn’t buy it at all, we’ve discovered that, by luck, we managed to downsize by never really upsizing to begin with!

But time is not on our side.  Some Baby Busters only have a few years left to provide for retirement. Others might have as much as ten years, which can pass in the blink of an eye.  If a Boomer wants to avoid becoming a Buster (living on cheese wiz and saltines) they’ll need to do the following:  First, cut back by living within their means and stop incurring debt; Second, a safe retirement is unattainable when there is debt so you’ll need to cut back even more to pare down that debt; and, Third, you’ll need to save.  Saving is not easy in a zero interest rate environment but you’ll need to save even more because the Fed wants savers to get nothing!  Worse yet, counting on winning at the stock market casino is not a plan for the average saver, just a surefire way to make the owners of the casino (Goldman Sachs) rich. So, downsize, pay down debt, and tighten the belt again to save before it’s too late!

For far too many Baby Busters living frugally is like being held in purgatory, living without easy credit feels like an excruciatingly slow death, and saving money, while paying back debt, is a living hell.

For lack of a better word, my wife and I were “lucky” to have survived the turmoil of our generation.  As my wife politely reminds me from time to time, “it’s nice to live in heaven before you die”, but the joke is if we had upsized in the ‘90s like most Boomers, today we would be having a hell of a time.

-- Posted Tuesday, 29 June 2010 | Digg This Article | Source:

- Richard Benson, SFGroup, is a widely published author on securitization and specialty finance, and a sought after speaker at financing conferences on raising equity for mid-market companies.

Prior to founding the Specialty Finance Group in 1989, Mr. Benson acted as a trading desk economist for Chase Manhattan Bank in the early 1980's and started in the securitization business in 1983 at Bear Stearns, and helped build the early securitization businesses at Citibank and E.F. Hutton.

Mr. Benson graduated from the University of Wisconsin in 1970 in the Honors Program in Math, and did his doctoral work in Economics at Harvard University. Mr. Benson is a member of the Harvard Club of New York and Palm Beach.

The Specialty Finance Group, LLC is a Florida Limited Liability Company and is registered with the FINRA/SIPC as a Broker/Dealer.


Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to >> Story

E-mail Page  | Print  | Disclaimer 

© 1995 - 2017 Supports

©, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of, its affiliates or advertisers. makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of, is strictly prohibited. In no event shall or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.