When you think of the 60s some of the first things that come to mind include the civil rights movement, women’s liberation, Neil Armstrong walking on the moon, John F. Kennedy’s assassination, and Woodstock. These are some major events that occurred during the 1960s that have made a lasting impact on American history.
When you compare the 1960s to now, you may realize there have been many changes that affected the Baby Boomer generation and their retirement plans. From high inflation and longer life expectancies to rising health care costs and the decline of savings rates, America has surely changed since the 1960s.
Cost of Living
Back in the 1960s, the standard of living was much different than it is today. Common items may seem affordable to us now when we look back at how much gas, a loaf of bread, a gallon of milk, a carton of eggs, or a Big Mac used to cost. But then again the minimum wage was just $1.23 and most families had just one income, while today, most families are two-income households. The average annual income in the 60s was just under $5,000 while today it’s about $50,000. Buying a home back then was less than $20,000, but today purchasing a home costs more than $150,000 and there are more loopholes and bank loan approvals required before actually owning a home. Consumer products like television sets, air conditioning units, and large household appliances were a lot less in the 60s than they are today as well.
Saving for retirement has also been a challenge for many people, whereas in the 1960s it was much more common to have a respectable nest egg. More experts agree that people don’t have enough money saved for retirement. They estimate that many Americans are at risk of outliving their retirement savings due to a growing gap between the money needed to maintain a standard of living and what they actually have saved in the bank.
Personal savings rates in the U.S. are also on the decline and have been for the past 30 years. People are only saving about four cents on the dollar of their income, which is less than half of what people used to save decades ago. And because people aren’t saving enough, experts say many retirees will be forced to go back to work during their retirement to supplement their income and afford medical care.
Another major change from the 60s is health care costs. Americans today are paying more for health care than they did in the 1960s. Health care spending was at 5.2% in 1960 and has risen ever since. Today, health care costs are up to 17% of GDP and people will pay more than $300 per person over the next decade in out-of-pocket costs for health care. Baby Boomers will have to take this into consideration when preparing and saving for retirement. They might need to squeeze some pennies for medical care because it’s going to cost them more money to stay healthy.
The Baby Boomer generation in the U.S. makes up a large portion of the population, which is about 76.4 million. The population in the U.S. continues to grow as infant mortality rates are down and life expectancy is much longer than it was in the 1960s. Smoking is also less popular now than it was in the 60s. About 40% of Americans were regular smokers in 1969, but today only 22% of the population regularly smokes.
Although the country has made some big strides since the 1960s for social changes, there is room for more positive growth and improvement in healthcare, retirement reform, and government policies.