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Turning point: the 2020s baby boom retirement surge

And so, what can we expect of the balance of the 2020s beyond the coronavirus?

It is likely for example that there will be greater use of technology and a lesser engagement with China. It is also possible that the community will take a renewed interest in hand washing, in appreciating family, in having the freedom to travel beyond Australia. These ‘reactions’ to events triggered by the pandemic are logical enough, I suppose, but there is something else sitting out there, lurking (with intent) in the middle of the decade.

Baby boom must lead to a baby bust

It is something demographers have known about for decades. Indeed, there have been books written (by demographers) about its impact. This menace goes by the name of the baby bust. If you accept there was a baby boom in the 1950s then 70 years later the limitations of human life dictate that there will be, there must be, a baby bust.

In a crude sense, the baby bust takes effect when baby boomers press into their 70s and – how shall I put this? – then they die off. But the baby bust is more than this. It will trigger workforce and funding issues that will need to be managed. More baby boomers aged 65 exiting the workforce than 15-year-olds entering the workforce leads to a diminution of workers and, some would say, also of taxpayers.

The number of people entering the so-called ‘retirement age’ of 65+ has ramped up over time. In the 1990s, for example, Australia’s 65-and-over population increased by an average of around 40,000 per year (see graphic). Retirees in this decade were born in the 1920s.

Boomer’s retirement mountain: net annual change in Australian population 65+, 1966-2066

Data source: ABS Historic, Estimated and Projected population

But 30 years later in the 2020s it’s a different story. The number of Australians being added to the 65+ cohort every year will rise during this post-pandemic decade passing 126,000 in 2021, peaking at 137,000 in 2026, before subsiding to 105,000 in 2030. This surge in the retiree population is caused, of course, by the great baby boom of the 1950s.

Impact of surge into retirement towards five million

The transitioning of the baby boom population from working age to retirement stage will ‘play out’ in the post-covid 2020s. The retirement cohort will continue to expand for another five years creating a community culture that is hyper-sensitive to retirement issues.

It could be argued that the social impact of ‘retired Australians’, based on underlying demography, will not begin to subside until later in the decade.

In this context the period 2021-2027 will represent the peak years of the Australian baby-boom retirement surge. Not only is this an issue of the retirement cohort’s collective voice (now close to five million) but this will also translate into an elevation of retirement issues such as concerns about health care and aged care and access to various aged-based financial concessions.

Perhaps there will be a new political movement based around ageism?

Baby boomers will be the first generation of retirees who will have memory of their parents in retirement. Previous generations of retirees had no real experience with long-term ageing because, well, their parents died in their 60s. The parents of baby boomers lived on and into their 80s and 90s and there’s a photographic record of their time in retirement.

Baby boomers will not age as past generations did

Baby boomers in retirement, peaking in the middle of the 2020s, but extending in progressively fewer numbers into the 2030s and 2040s, will be determined not to age as their parents aged. They are already railing against ageism. Many are remaining in the workforce. Some are re-partnering later in life. Some are choosing to remain single (but not lonely) in life’s later years.

The concept of a large proportion of the population living beyond the age of 65, being dependent upon the goodwill of younger cohorts, and the reliability of governments to uphold the social contract implicit in the idea of 'ageing with dignity' are all new to humanity.

What to do with the aged wasn’t a problem for previous generations in history.

It could be argued that the 2020s really is a turning point and not just because of the new world that is likely to emerge from the post-pandemic ashes, but because of the longevity of life for perhaps one-fifth or one-sixth of the Australian population.

Mistakes will be made by governments and retirees. However, what will be required throughout the decade ahead is goodwill on both sides. And an appreciation that no society in history has been placed in the position of having to care for such a large proportion of its population in the older age groups.

The next generation of retiree will be fitter and lither than previous generations. Baby boomers are interested in wellness; they stopped smoking decades ago; they watch what they drink. Some will want to work on, not wishing to be a burden, but they’ll also want to work on for the purpose of leaving a legacy of sorts.

The old idea of retirees wafting off into the abyss of retirement might have worked for the pre-boomer generation. It will not work for boomers.

They are well educated and they have time on their hands

The next generation of retirees will also include a large proportion who had access to (fee-free) tertiary education in the 1970s. And so, the 2020s will deliver the first generation of retirees who will be tertiary educated, opinionated, articulate, computer-literate and with time on their hands.

Could I suggest that this is a dangerous combination for politicians, bureaucrats and business leaders who will have to deal with an increasingly galvanised and vocal retiree population?

The 2020s will present a number of challenges for an Australia struggling to recover from the devastation of the coronavirus impact and its associated lockdowns.

However, as difficult as this recovery process may be, and especially if it coincides with geopolitical challenges for this part of the world, there is some comfort to be taken in the knowledge that these (baby bust) issues will also surface in other developed nations like America, Great Britain, Canada and especially Japan.

It may take some time and there may be some missteps along the way. But I have confidence that eventually the inherent prosperity and goodwill of the Australian people will prevail and deliver a society that is indeed fair to and caring of the baby bust cohort as they gingerly make their way through life’s later years.


Bernard Salt is executive director of The Demographics Group. Baby bust graphic published in the ASFA white paper February 2021, reproduced with permission.


Ermira Pirdeni
July 26, 2022

The United Nations Decade of Healthy Ageing & Communities (2021–2030) is to improve the lives of older people, their families, and the communities in which they live.
To foster healthy ageing and improve the lives of older people and their families and communities, fundamental shifts will be required not only in the actions we take but in how we think about age and ageing.

February 15, 2022

Great thought piece.
Can we get some thoughts on the boomers financial situation, they will be retired a long time and need to fund that. The gov will have a hard time keeping up pensions with a shrinking tax base. Will the boomers be able to sell their houses to the next generation at the highest valuations ever? As governments debase currency and bond yields fall how will it work ?
Anyone have any info ?

Chris Penn
April 02, 2022

I don’t think you are right about the debasement of the currency. When the value of land falls we are headed for war /this is proven in records from the period before both of the world wars. My parents were born after the First World War and survived the Spanish flu, polio, whooping cough the depression and then the Second World War, tuberculoses came when the men returned and the land was cleared. Both my parents worked glad to be alive as many of friends and relatives had not survived. We worked three jobs (baby boomers) survived the governments flip flopping with policies and the recession we had to have the loss of our business because trading went twenty four hours. You also will survive when we downsize and properties come on the market. Many of my friends shared houses with other relatives and friends pooling their resources to qualify for deposits and loans. Some have found it easier to have three generations in the one home /a flat over the garage means privacy for a young couple a granny flat means less stress for carers and a babysitter on tap.with better education for your generation you are definitely one step ahead of mine. Don’t despair even if you have to build your own home out in the bush or live on a houseboat or go share farming keep your dreams alive and your mind open to all possibilities.

June 30, 2021

I'd have some sympathy for baby boomers but they treated gen X badly particularly in the workforce. So I don't care one jot for them now. I won't work with them, give them a contract or hire them. 

Rob C
September 29, 2021

Sorry you and your cohort got treated badly Nick. So did some of us boomers by the same professional psychopaths. Unfortunately, you will find some in the Gen X cohort too and they will be more likely to be found in positions of influence. It's the human condition: those in power are most likely to be influenced by a need for power, not a need for love or community or even achievement (this last explains a lot about disfunction in bureaucracies). I wish I could quote the studies but when I did my first degree, commerce, in the 90s this was the definite findings in motivational studies of that time. Of course, some people can be motivated for power so they can change things for the better. Sadly however, my observation is that this is the minority of 'leaders'. The answer for me was work for yourself, and be selective about who your customers are, or at least ditch them after the contract if they are no good. To do this successfully you have to be a top performer. Good people are good people regardless of their cohort.

Roy Taylor
March 30, 2021

I'm 77 and worked 3 hours before school and after school form the age of 10 , left school at 15 and never ever worried about getting a job worked full time 60 plus hours a week untill 70 and I still do relief work in my industry.
Unfortunately there are to many whiners in our country, get of your arse and get out there and into it.
I have owned a number of houses during my time, never got interest rates as cheap as now, in the 60's rates were at 6 %, I paid 17% in the 80's for home, paid 23% for bank bills for business at that time and I got through ok , bit of hard work never killed ant one.
To many people worry about things that they have no control over the weather, the planet will give you what it wants to give, not what you want it to do.
Just get out there and give life a go its the only one you ever get, be happy mind your own business get married have kids get divorced get married again buy cars, boats, aero planes , drink eat laugh with your friend just enjoy life, and all of the ups and downs because you will get plenty and you will be dead before you know it.

Jim Simpson
April 07, 2021

What a great comment by Roy - agree 100%

Jim mullany
April 26, 2021

Im 70 . I echo all the comments above . You've gotta Max everything in life .

June 03, 2021

Wonderful !!! I wish we can all live like that.

September 26, 2021

Love this comment by Roy Taylor - couldn't agree more!

March 28, 2021

Greed will concur. Renewables will die and PC culture will dissolve. Climate change will focus on the sun and earths magnetosphere and CO2 will be needed to grow food.

Warren Bird
March 28, 2021

Karla, there is no scientific support for the idea that anything happening with the sun or our orbit around it is causing global warming. EG there's been no change in the amount of energy reaching the outside of the earth's atmosphere since they started measuring this in 1978. See NASA for information on this and some of the other evidence against that proposition -

George Wilson
March 27, 2021

What remains unaddressed is that with increasing longevity comes increased incidence of dementia. Dementia as a social/financial problem is not really considered, nor is the discussion around voluntary euthanasia. A commentator notes the large voting block of retirees. I would expect that most people would not wish to live on with dementia, and would welcome euthanasia to relieve themselves and family, (and society) of the emotional and financial burden. My mother and mother in law died with dementia in Aged Care facility, and their deaths was a welcome relief for all. I thought it interesting the demographer commented on "Aging with Dignity" but ignored the reality that "Aging with Dementia" has no dignity.

Warren Bird
March 28, 2021

George, while respecting your right to have a personal opinion, I can't let this go unchallenged. The idea that someone gets diagnosed with dementia and is suddenly not worthy of their family's love and support is abhorrent to me and to all those who hold a traditional view of the value and sanctity of human life on which our society has been based.
This is not the place to debate this topic, but I just couldn't leave it dangling as that might leave the impression that it's an indisputable point of view. It isn't.

March 30, 2021

Warren not everyone has a family and I certainly don't want to live with dementia. You should not decide what should happen with my life. A discussion about euthanasia is long overdue.

Warren Bird
March 30, 2021

Ruth, I've no doubt there is a need for the discussion. Thought I've clearly given my own view, my main point was that this is a debatable subject, not as clear-cut as George's view implied. But I really don't think that a financial investment newsletter is the place to have that debate, so I won't engage it further here.

April 05, 2021

I agree with George and Ruth. Voluntary euthanasia would solve many problems and worries of getting older. Ideally, I would like to live a long and useful life, then die quickly and painlessly. I fear getting all the ailments of old age, becoming incontinent, dependent, bed-ridden and incoherent. I expect my savings will last, but the uncertainty of my death date means I have to keep funds in reserve for unknown health and longevity scenarios. Far better that at a time of my choosing I access voluntary euthanasia and bid life a fond farewell. So please explain why someone else's religious beliefs on the 'sanctity of life' should stop me terminating my own life. it is a nonsense. My body, my choice (as with abortion). Of course, those with a vested interest in the lucrative drug industry and those who selfishly believe their religious and moral views should be imposed upon others will oppose me/you/us controlling our own time and nature of demise.

Warren Bird
April 06, 2021

I did say this isn't the place for the debate, but be very careful AlanB. The original comment wasn't made about someone who gets old and feels pain all the time deciding for themselves to end it, it was about relatives making that decision for you because they're uncomfortable watching you suffer. The risks that this just turns into plain, downright murder are very real. Is that what you want?
It's not what I want and I demand that the government retains my right to stay alive as long as I choose even if my family can't stand watching what I'm going through. I am not pushing 'my religion' down anyone else's throat, just expressing my desire that the irreligion of others doesn't provide anyone an easy out to end it for me. Or for you, either.
I actually disagree with euthanasia at all, but at the very least if we're going to be talking about it then we have to make sure that the debate is about the person whose life is going to be ended being absolutely, fully cognisant of and supportive of that decision.
So please, listen to what people are actually saying and don't presume that I or anyone else sits in a particular camp or is trying to force anything on someone else. This debate needs to be had respectfully, carefully and clearly.

Bart McCarthy
March 27, 2021

I don't think I've ever read so much self opinionated middle class rubbish. The RBA under Dr Lowe & the current Liberal Government have trashed the aspirations of thousands of lower paid workers ever owning a property. But most don't really care, its just a conversation over dinner.
Wage growth is zero, interest rates lowest in history, average mortgage debt highest in living memory, household debt 3rd highest in the world, property prices amongst the HIGHEST in the world, average for Sydney is over $800k?
Indigenous health & living conditions worst in living memory. Then you have the idiots at ANZ telling all who will listen that property prices will increase by 17% in next 2 years, I wonder if these overpaid twerps think how this makes people feel who can't get into the market?
Many older Aussie gaming the system, living in high value housing disposing of cash assets so they can claim the pension and suck the life blood out of young workers.
Most of the comments reflect a BUBBLE mentality locked firmly in "I'm alright Jack" but here are my thoughts anyway.
Covid19 forgotten, GFC forgotten. A crash will come & it will be a stark reminder of reality, no such thing as free money!

Janine Devitt
March 25, 2021

Well at least no one suggested having more kids as the answer to the dependency ratio question. We can’t work longer though. So perhaps an asset on the family home is warranted. $250,000 but debt can reduce the final outcome. That is reverse mortgage - worst idea, downsizing would be more sensible. If your kids desire a house then downsize.

Howard Coleman
March 30, 2021

Why can't we work longer? I'm 73 and enjoying working in a role where I'm passing my knowledge on to a younger generation.

Martin Mulcare
March 25, 2021

Plenty of great insights from Bernard. One that caught my attention was: "Baby boomers will be the first generation of retirees who will have memory of their parents in retirement". There is no doubt that the Australian aged care sector is in dire need of an overhaul and serious (and ongoing) investment. Will the boomers that are retiring soon be willing, based on their parents' experience, to work hard - and pay for - a much better aged care system so that it is fit for them in say 20 years? Or will they be so confident/complacent/short term that there will be no support until it is too late?

Jon Kalkman
March 25, 2021

Can we please get people to understand that franking credits are not just a benefit for retired Baby Boomers? The tax credit that comes from the pre-paid company tax associated with owning Australian shares is a benefit to ALL shareholders, because franking credits simply transfer company profits to the individual taxpayer where they are taxed at individual marginal tax rates.

The franking credit is only paid as a cash refund if this tax credit is greater than the tax payable. Most shareholders don’t even notice this credit, but their accountants do, because all it does is to reduce the tax they would otherwise pay.

The difference between retirees and other shareholders is their tax rate. The issue is not the generosity of the franking credit, it is the very low (or zero) tax rates that retirees and super funds enjoy. Therefore, if some taxpayers, including industry super funds, are deemed to be unfairly benefiting from franking credits, the solution is to look at the tax rates, not franking credits.

The funding debate will come down to which taxpayers should pay more tax. Given the size of the demographic of Baby Boomers and its political influence, that should be an interesting debate.

David Wilson
March 25, 2021

A point well made Jon. However, at the last Federal election franking credit reform was very effectively portrayed by the Coalition as the 'Retiree Tax' (ie. Boomers tax) and the electorate allowed itself to be conned as the amendments would have only meaningfully impacted a small proportion of the population. So much for fairness in our tax system. With the Boomers it is invariably a case of "pull up the ladder, I'm alright Jack!"

Jon Kalkman
March 25, 2021

Taxpayers on low tax rates include age pensioners, industry super funds, unions, churches, charities, hospitals, universities and of course SMSFs in pension phase. Under Labor’s policy taken to the last election, only the last group stood to lose their franking credit cash refund. In that sense it really was a retiree tax. More specifically, it was really a self-funded retiree tax and designed with that special purpose.
It is still nothing to do Boomers and everything to do with tax rates.

April 07, 2021

I must say this also raises another effect of baby boomers retiring. And that is inheritance. Baby boomers hold collectively the largest accumulation of wealth of any generation ever. When they start to fall off the perch, that wealth will inevitably translate to a smaller population than it currently is spread across (our low fertility rates pretty much guarantee this). This will directly lead to a widening inequality gap, as well as rising inflation, and thus a significant devaluation of those inheritances. This, with a decressing population, a contracting economy (GDP growth is predominately fueled by population increase) will make it much more expensive for the government, and subsequently, the taxpayer to address. I know this is not terribly popular. The last election was partially decided on this issue after all, with many voters voting against addressing it. But the government may well end up needing to increase taxation on inheritance as a public necessity to ensure a fair distribution of overall national wealth. The debate on Inheritance, and where all of it goes has not reached that level of importance yet. But trust me, some time in the not too far off future, it will !!

Andrew Smith
March 25, 2021

My previous comment should have included this link to a well presented FirstLink article by Michael Collins in June '20 explaining: 'The populations of key countries are shrinking'.

Andrew Smith
March 25, 2021

Good article focusing upon population demographics and related issues in the ageing permanent population featuring the baby boomer bubble that are mostly ignored in legacy media.

This is opposed to the media obsession and focus upon 'temporary churn over' that has spiked our total population due to (undefined) 'immigration' (students, backpackers etc.) caught under the NOM (UNPD defined); as the graph focuses upon over 65 year olds it excludes most temporary residents (who have inflated population due to definition change of NOM in 2006).

Firstly if the ABS is replicating UNPD fertility rates, then one is sceptical of forecasts i.e. the significant rise in population mid century, how? The UNPD has come under scrutiny for inflating fertility rates which take off, again, mid century global population to reach double figures (in billions), but almost no other credible researchers or demographers agree; global population is expected to decline by mid century.

For investors, understanding local environment, this has significant implications on the property market with a whole generational bubble transitioning, downsizing and liquidating assets starting with five years (with oldies before), but backgrounded by supposed 'infinite exponential population growth' (Dick Smith et al.).; more existential threat to some than an actual future fact.

March 24, 2021

Not often mentioned but a fit and retired older population is also a replacement to do the unpaid work that was done by the women (who are now working)

Perhaps we could see a productivity boom

March 25, 2021

I love this comment and I completely agree Michael2! How lucky would we be to have the boomers turn round and offer their experience and time to help fill the innovation and resources gap that will be inevitable with the baby bust.

March 25, 2021

It might be the chance we have for bringing about the democratic social(ist) utopia. I reckon there is a motherhood gap at the moment – or "present" parent gap at the very least.

Peter Wurfel
March 24, 2021

The next 5-7 years are critical for this cohort to exert influence and get recognition for their needs. After that, as the data shows, the increase will taper for several decades, and the needs of this group will lessen relatively?
It would be interesting to see what the 20-65 year cohort are doing over the period covered by the chart?? Hope they are pulling their weight.

March 24, 2021

Interesting article

Policy changes have favoured the boomers for the last 30 years (first home owners etc) and due to their voting power the genXers (the depressed generation) have missed the handouts/policyencouragements as the boomers have passed through. Nothing will change as the boomers start you put it...die off. The bonus for GenXers, is not having (being forced to) fight wars

Intergenerational equity is s serous issue. Guess which generation i am from?

David Wilson
March 24, 2021

Excellent article. Thank you Bernard (and FirstLinks). For me the most telling line was:
"Could I suggest that this is a dangerous combination for politicians, bureaucrats and business leaders who will have to deal with an increasingly galvanised and vocal retiree population?"
Indeed it is a dangerous combination for the younger generations as well. It will likely to result in conservative Governments being elected for years to come as the Boomers seek to protect their patch and to hell with everyone else (franking credit and property tax concessions reform anyone?). Too bad if you were born after the Boomers and don't have wealthy parents.

March 24, 2021

Agreed. Great line.

(Is FirstLinks ground zero? – we've had some great skirmishes of late)

March 25, 2021

Not so sure about a conservative government being elected for years to come - many baby boomers are aware of the environment/global warming, women equality (just look at current Canberra politics as blokey bloke Scomo struggles with the issues), the struggle for their children to buy a house and if these engaged boomers are in critical seats then the conservatives can struggle.

Case in point is Tony Abbott's old seat of Warringah (white middle class electorate, high employment, high property prices) where a very active targeted campaign gave him the boot and put in a independent .

David Wilson
March 25, 2021

I agree 'davidy' that it is possible for Boomers to use their political muscle to unseat unpopular conservatives in marginal seats. I also believe that we should never give up on trying to make Australia a more equitable place (for instance so that everyone , including our children, can aspire to home ownership).
However, at the last Federal election once again the Coalition proved that scare campaigns are particularly effective when they target self interest. Consequently, as a nation we sold our kids down the river to maintain the status quo (on things like franking credits, property tax reform and climate change).

David James
March 24, 2021

The beauty of demographics is that the future has already been written.

It would have been good to see the forecast dependency ratio highlighted here. That shows the dire state ahead for fiscal policy makers. Further hampered by a declining birth rate and zero NOM. Luckily we aren't entering this period with high levels of debt to service! Ooo..

March 24, 2021

The BBP?

The Baby Boomer Party!

Focus. Savvy. Spare time. Moneyed. Motivated.

Could be an attractive option cf the current mobs...Liberal?, Labour?, etc

March 24, 2021

With five million of us and most of the money, we need to realise what a powerful voting block it is, and watch rights are not watered down as the next generations move into powerful business and political positions.

David Williams
March 24, 2021

A timely and elegant analysis. It shows what is likely to happen if ‘we’ do nothing. At the community level, the mass of older voters will increasingly dominate policy. As they become more informed about their influence, they will change the future. We become more different from each other as we age. To deal with the individual consequences and define actions, we need to be more aware of our own longevity and its drivers. Personal longevity planning identifies the widening range of choices open to us and will properly inform our commitment to our financial and other lifestyle decisions – including how long we choose to remain productive. Maintaining productivity longer can contribute to sustaining economic growth in the face of recent pandemic and other impacts. Personal longevity planning also highlights the important common ground with others and will drive community action for reform, innovation, and mutual support at all levels. As a consequence, even the demographics may be much different, including significant changes to healthy ageing and lifespans. Personal longevity planning is an essential first step for a better personal and community future.


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