Baby boomers are undeniably the generation that built America it stands today, for better and for worse. And there is no aspect of society where this holds as true as it does in the realm of business. Today a third of all Americans rely on baby boomer businesses for income, businesses that total to over 2.3 million in America. 2.3 million small businesses, 75% of which are profitable and 35% of which have been operating for over ten years.
Boomers are Retiring in Full Force
These are impressive statistics to say the least, but it does seem this era is coming to an end. Today 10,000 baby boomers retire daily. Meaning thousands of businesses are having their owners retire month after month. This isn’t inherently such a bad thing, but it does become a bit more worrying when considering that 58% of small businesses have no transition plans. Times have changed from the American family business, most millennials today simply have no interest in taking over the family business.
Instead, future generations are defined by their disdain for the nine to five, defined by the desire for flexibility. It simply isn’t appealing anymore to work at the same shop one grew up in, instead setting one’s own path and creating one’s own meaning has become a defining cry for future generations.
So for many baby boomers, when the time comes to retire, the time comes to sell their businesses and make some retirement cash. Cash that is of extreme value when considering the fact that 45% of all baby boomers have no retirement savings. And even those with savings are going to have a hard time due to the steady inflation the U.S has faced for years.
Who Will Pick Up the Slack
The process of selling also keeps the country’s economy afloat. While closing a business just leaves a deficit in the market, selling it brings new blood into the business and a new perspective. Millennials now more than ever are looking to own their own businesses and set their own schedules. While they don’t want to take over the family business, that doesn’t mean they don’t want to buy one, and starting from the base of a baby boomer business is nothing to scoff at.
These businesses are good investments, with high profitability, loyal customers, and typically great locations. This is just one way that baby boomers are transferring their wealth and setting the stage for the next few generations. As the baby boomer generation nears its end, there’s an estimated $68 trillion that will be transferred to their children alone.
In Conclusion
Another big chunk in the baby boomer transfer comes in the form of charities. $11.9 trillion is expected to go to charities as baby boomers move on. This is the boomers’ chance to really make a difference in the country they’ve created. Be it charity, business, or by trusting in their children. The wealth they’ve amassed has to go somewhere, and as they retire and see their time end, it can only be hoped the transfers are positive.
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