While there were many consistencies in investment choices for all Baby Boomer executives, the report found some differences in investment strategies or asset class choices based on age.
The report looked at the executives in three different age categories: those born 1946-1951, those born 1952-1958 and the youngest of the Boomers born between 1959 and 1964.
Large-cap stocks were the most popular of assets measured. According to the report, the number two and three most popular asset classes varied by age group, but fixed income, small caps and money markets were the favorites with Baby Boomers.
According to Ted Disabato, Chief Investment Officer of Clark Consulting's Investment Group, "Baby Boomer executives certainly have more investment choices than their parents did.
They have benefited greatly from the strong US economy over the last 60 years and are very comfortable with equities as a major portion of their retirement account."
Late Boomers (born ’46 – ’51)
Large-cap stocks were the most popular of assets measured, with the oldest group placing nearly 40% of their assets in that class (39.5%).
The second and third most popular asset classes were fixed income (14.1%) and small-caps (10.7%).
For Middle Boomers (1952-1958), small caps were also third most popular, with 12.9% of assets measured. However, second-place money markets barely edged small caps (13.4%) by fewer than 60 basis points.
Middle Boomers (born ‘52 – ’58)
Middle Boomers allocated 35.9% of their assets to large-cap stocks, and the youngest group had 35.0% of their assets allocated to large-caps.
Young Boomers (born ’59 - ’64)
The youngest of the Boomers--those born between 1959 and 1964--differed from their elders; small-caps were not in their top three measured assets. Instead, they selected money markets (17.3%) and fixed income (11.2%).
"Counter intuitively, the youngest group of Boomer executives allocated almost twice as much of their accounts to the 'safer' investment of money market funds than did the eldest group with 17.3% and 9.6% respectively," Wamberg continued, "even though it might be wise for them to take more risk.
While we tend to presume that the closer one is to retirement age, the more conservative their investments will be, our report indicated otherwise."
After a year and a half of retirement, the focus on what is important and what is not, is becoming much clearer as time passes by. At this point in time they are, keeping healthy, both in mind and body and being wise in our investments, so we can get a return and hopefully be able a little more comfortable in our later life.
No comments:
Post a Comment