***Baby Boomers and the Lessons of Change from the Great Recession

written by Allan J. Hamilton, MD, FACS

The Great Depression shaped two earlier generations. It changed how our parents worked and saved. It haunted my grandparents. As hard as it has been to experience this most recent economic turmoil, we must hope that our generation of Baby Boomers will emerge from the Great Recession of 2008 having learned some valuable, enduring lessons that will teach us how to our find less stress, more stability, and enhanced well-being in our lives.

While the recession has proven to be one of the most painful periods in the recent history of our nation, we must look beyond the hardship to disce
some valuable themes.

1. Downsize. We need to plan to scale down our lifestyle as we get older. Many of us, as we went into late middle age, entertained more expansive tastes and lifestyles fueled largely on credit. When the economic bubble burst, we were left worse off than if we had stuck to a predictable timetable of shrinking into a restrained standard of living rather than expanding into a larger one.

2. Keep learning new job skills. This downtu
showed that the jobs of the past—manufacturing, mid-level management—were the most vulnerable and were the first to fall victim to the recession. Even the professional sector was hit hard in 2008. So we need to be looking to constantly be adding to our resume—even as we get older, we need to stay current and relevant. The way we do that is to engage in a program of life-long learning. Never become obsolete.

3. Stay healthy. The most unfortunate among us were those who were hit by both health and economic calamity at the same time. Cultivate healthy habits with the same periodic and rigorous review that you lavish on your retirement portfolio. You simply can throw out any plans and strategies you may have for your older years, if your health deteriorates. Health needs to be a top priority.

4. Family counts. Take some time to re-forge relations within your immediate and extended family. One of the themes of this Great Recession is that when the rubber meets the road in a crisis, many people can only count on family to help. And that’s precisely what a family should do. Our loved ones—friends and families—are the emotional buffer that helps us absorb the shock of such calamities.

5. Change your style. Getting through the recession is not a matter of holding your breath and tapping your foot until the next economic bubble comes along and you can go back into debt. Get in the habit of getting by with what you have and paying as you go. Put the credit cards away and pay cash or by check. We’ll start sleeping better.

6. Look for small pleasures. Not big ones. You can go out into your backyard and putter in the garden or take the bike for a sunset spin. Those pleasures are within your grasp on an almost daily basis. That means when you need that boost, it at your fingertips. If, instead, you’ve gotten yourself psyched up that your one great “blow out” is going to be that great (expensive) cruise a year from now and that ends up the victim of the recession, then you’re left feel sad and disappointed. At the same time, look for cheaper vacations, perhaps traveling locally by car, rather than abroad.

7. Get into cooking. Learn to eat out less. You don’t have to give up restaurant-style dining, you just have to learn how to cook it yourself. And don’t forget to spiff up the presentation too. Your special “night out” can be on the patio.

8. Change now. Even if retirement is a couple of years away, make the changes. Put more money into your retirement accounts. Plan to stay working as long as you can. Not only does keep you young at heart but it means your monthly retirement benefits will be larger when you finally do retire.

9. Greed is not good. The 2008 recession showed that we are prone to fall victim to our own desires to believe in outrageous, unrealistic economic growth. The problem is that we fool ourselves very easily into believing things will always get better. But the real world works cyclically. When deals sound too good to be true, they are. When someone talks us into taking loans for which we need no money down, it’s never going to end up well. When someone can’t explain the financial details clearly, it’s because they’re murky—for a reason.

10. Learn. The Great Recession will not go away quickly. Hopefully, the lessons we’re learning will fade even slower. To eliminate the stress we’ve experienced during this Recession, we need to develop a more restrained, conservative mentality. By conservative, I mean making the most of what we have rather than try to figure out how to acquire more.

The Great Recession has hopefully sent a message to all of us Baby Boomers: the middle way is path of balance, moderation, and tranquility. Yes, the soaring boom times will not carry us as high but the falls won’t be as painful either. We’ve received a powerful “stimulus package” to change our values and our expectations.

You may respond to Dr. Hamilton in the “Leave a Comment” section below or email him at ahamilton@boomer-living.com.

Tags: baby boomers, economic calamity, economic turmoil, grandparents, retirement portfolio