Cooper's new book says wave of boomer retirees to crest in 2025; will
profoundly affect labour markets, the economy and financial markets
TORONTO, Jan. 14 /CNW/ - Boomers will redefine retirement with enormous
energy and creativity. Many will work well beyond age 65 and mostly by choice,
seeing this as a time for advance not decline, according to Dr. Sherry Cooper,
Chief Economist, BMO Capital Markets in her new book released today, The New
Retirement: How it will Change our Future.
"The boomer generation will be reaching traditional retirement age very
soon and the enormous wave of boomer retirees will crest in 2025," said
Dr. Cooper. "With the dramatic rise in longevity, healthy goal-driven boomers
will seek purposeful leisure - a time for regeneration, rejuvenation, and
lower-stress contributions to society and their own personal wealth."
Referring to her new book, Dr. Cooper notes that it is not a typical
retirement-planning book nor is it a personal finance book. "This book looks
at the optimal transition to late life and what it takes to achieve a
successful final third of your life. I examine how we can prepare to give
ourselves the best chance of physical and mental well-being as well as
financial security. We can actually regenerate rather than degenerate," she
The book focuses on a number of subjects related to retirement and
includes the following key points on each:
The New Retirement
- Despite the inadequacy of many boomers' savings habits and the
reduction in defined-benefit pension plans, surveys suggest that
most boomers expect a comfortable retirement with sufficient
- Most report that they would choose to work, at least part-time, in
- Labour shortages and rising healthful life expectancy will
encourage boomers to work longer, helping to meet the financial
demands of this "sandwich generation".
The Generational Divide
- As children of the Depression and wartime, parents of boomers are
more frugal than their children. Conversely, boomers grew up in
times of economic bounty and represent huge buying power.
- Early boomers were the first in their generation to enter schools,
the job market, and the housing market. They benefited from being
the first in. Late boomers had very different life experiences and
have found it tougher to amass wealth.
Health and Achievement
- The increase in longevity provides the opportunity for boomers to
do so much more after age 60 than earlier generations did.
- Late-life can be active and pain-free. You can be accepting of
natural physical and mental weakening, while enjoying the enhanced
wisdom, selflessness, and peacefulness that aging can bring.
- Success in life varies from person to person, but it is much
broader than simply success in work.
- Boomers have strived for self-actualization all their working
lives. In retirement, they will do so by giving back and leaving a
Canadian Boomers in a Global Context
- Labour shortages will mount in the developed world - especially
Canada - as aging boomers leave the workforce.
- Potential growth in advanced economies will slow unless the
decline in the growth of the labour force can be offset by rising
productivity growth, increased immigration of skilled workers,
additional outsourcing, and later retirement for boomers.
- Productivity growth is essential to raising living standards. We
need more appropriate corporate tax policies to encourage
investment to boost productivity.
The Aging Population
- Large numbers of retirees will strain the pension and health-care
systems in most industrial countries.
- Governments will be torn between the needs of boomers (health
care, pensions, safety, public services) and those of young
families (schools, highways, affordable housing, daycare). There
could be significant conflict between age groups. This requires
immediate action and planning.
Lifestyle and Health Planning
- Develop a lifestyle plan for retirement. It will help determine
(and be determined by) how much income you will likely need (and
have) in retirement. Develop this plan long before retirement and
test it out - what you thought was ideal may not be so.
- Your health is paramount. Do what is best for your health and
well-being. Make sure you have easy access to good health care.
- Stress is a killer, so is obesity. Premature illness and death can
be mitigated by lifestyle and nutritional choices.
- The like between body and mind is well established. Healthful
emotional development is a life-long process and adds life to your
years as well as years to your life.
Dollars and Sense
- For the day you stop working, you may need more money than you
- Large nest eggs are required to cover the uncertainties of not
knowing how long you will live, how large financial asset returns
and inflation will be, or how much money you might need for
unexpected but necessary expenditures.
- Rely on accredited experts with experience and references to
devise your investment plan. Any consideration of financial issues
should be discussed with a disinterested expert.
Have Boomers Saved Enough for Retirement?
- CPP will not be sufficient to ensure the maintenance of an
affluent lifestyle. Increasingly fewer workers are covered by
traditional defined benefit pension plans, as the cost to
employers has risen sharply with the rise in life expectancy.
These days, defined contribution plans like RRSPs are more the
- Relatively affluent families must save significant amounts for
their retirement security, some will need to save beyond the
annual maximum contributions to their RRSPs.
- Investors should look at a diversified approach to income
generation and inflation protection. A portfolio of at least 50
percent stocks (especially high-quality dividend-paying stocks)
and 50 percent bonds has the best chance of achieving portfolio
How Much is Enough?
- As a rule of thumb, you will need a retirement nest egg of between
20 and 25 times the level of desired pre-tax annual income over
and above the income from government and private pensions in order
to generate the income you need.
- This is a conservative rule, allowing you to withdraw between 4
and 5 percent of your next egg in your first year of retirement.
Each subsequent year, you can increase your withdrawal rate by the
rate of inflation.
Health and Happiness
- A successful retirement for most people is to be physically and
fiscally independent, to be active, and to have love and purpose
in their lives.
- In the new retirement we will not settle for personal
diminishment, social isolation, dependency, and inertia. We will
remain active in mind and body, and most of us will continue to be
productive well into our eighth decade.
- A positive attitude is much more than being unrealistically
optimistic. The reality is that bad things will happen to all of
us. Good coping or adapting skills are essential to successful
The New Retirement: How it will Change our Future is a Viking Canada
hardcover from Penguin Group (Canada), and is now on sale at major bookstores.
Comments about Dr. Cooper and the book:
"Sherry Cooper is a dynamo - bright, savvy - and literally redefines the
way we view retirement and what lies ahead for us in this groundbreaking
Don Tapscott, bestselling author of Wikinomics
"As expected, the estimable economist Sherry Cooper provides sage
financial advice to baby boomers contemplating their retirement. But surprise:
she also draws from the latest literature in psychology and gerontology to
offer wise counsel on how boomers can live the second half of their adult
lives productively and in good health. Turns out we don't have to be
millionaires for the best years of our lives to be the ones ahead of us."
Michael Adams, bestselling author and president of the Environics group
of research and communications consulting companies
"With her usual combination of trenchant analysis and creative insight,
Sherry Cooper draws a portrait that will redefine retirement and, indeed,
society as we have come to know it."
Allan Gregg, Chair, Harris/Decima Research
"As one would expect, Sherry's latest book is crisp, clear, focused, and
laser-like in its ability to answer the questions that all of us had better
start asking. The New Retirement offers just the kind of analysis and insight
that both informs us and jolts us into taking action."
To hear directly from Dr. Cooper about her new book, visit BMO's
retirement website at: www.bmo.com/retirementyourway to view a video podcast
with Dr. Cooper and veteran journalist, Pamela Wallin. This episode is part of
a podcast series BMO launched last year that examines the emerging issues
facing Canadian boomers who are approaching retirement.
Dr. Cooper will be available for media interviews on the book in several
Canadian cities over the coming weeks. If you would like to arrange an
interview, please contact Peter Scott at BMO Financial Group or Debbie Gaudet
at Penguin Group (contact information below). Dr. Cooper will be in the
- Wed. Jan. 16: Winnipeg, MB
- Thu. Jan. 17: Regina, SK
- Tue. Jan. 22: Ottawa, ON
- Wed. Jan. 23 - Thu. Jan. 24: Vancouver, BC
- Wed. Jan. 30: Edmonton, AB
- Thu. Jan. 31 - Fri. Feb. 1: Calgary, AB
- Wed. Feb. 6: Halifax, NS
- Fri. Feb. 15: Montreal, QC
For further information:
For further information: BMO Financial Group: Peter Scott, Toronto,
PeterE.Scott@bmo.com, (416) 867-3996; JoAnne Hayes, Toronto,
firstname.lastname@example.org, (416) 867-3996; Ronald Monet, Montreal,
email@example.com, (514) 877-1873; Laurie Grant, Vancouver,
firstname.lastname@example.org, (604) 665-7596; Penguin Group (Canada): Debbie Gaudet,
Toronto, email@example.com, (416) 928-2410; Internet: