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Check out this article: Baby Boomers Make Rich Targets.
It’s a very helpful list showcasing all the ways that Baby Boomers can be targets of scams. It sounds like a crazy number, but there are 78 million Baby Boomers, comprising 8.5 trillion dollars in assets. As Boomers are generally more secure in their jobs, we’ll be more likely to fork over money to any one of these scams. The basic rule is this: any outfit that asks for a lot of personal information upfront, including SS#, credit card information, as well as “transaction fees,” as in the case of fraudulent contests, should be avoided.
Fortunately, fewer Boomers are falling for these identity theft schemes than in the past. I have to admit, the first time I got an email stating that I’d won the lottery and I just need to claim my money, I believed it. The same went for the Nigerian (or other country) money scam. The first time. The fortieth time I got a spam message beginning, “Dearest One,” I was no longer fooled. Scammers invent new scams by the day, because it’s these new scams that have the best success rate. Basically: never, never give out your credit card information, unless it’s for something you seek out to buy online, at a trusted site. |
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Everyday you’re seeing new stories about how the Baby Boom generation is going to tax the Social Security system because of the largest influx of retirees in history. You know what’s not mentioned often enough, but should be? The amount of credit card debt. The recent mortgage meltdown shows that bad credit could have a dire long-term affect on the economy, and with it each and every pocketbook.
I remember when I was a young pup, I was adding money to my credit card bills at an alarming rate. “Hey, what’s a $5000 credit card bill, I’ll pay it off eventually.” “What’s a $10,000 credit card bill, I’ll pay it off eventually.” “What’s another credit card, I’ve been paying off one on time.” And so on. And that was in my thirties. Thankfully, I didn’t fall apart completely, though that above scenario is a recipe for a credit disaster. Instead, I got a better-paying job and put down a significant amount above the minimum (at least $100) and started paying off my bills. Eventually I got the balance well below $10,000 and as a reward my credit card company gave me a better APR on the card, a reward for hard work. To my mind, that reward was better than a points program.
Anyway, I was able to get out from under my debt. But it’s got me thinking about how it would have looked if I hadn’t. By the time I was thirty five, I had close to $20,000 in credit card debt. Sixty-year-olds could be looking at double that or even more. Sure, some spending goes down as we seniors don’t buy as many CDs or as many dinners, but still this is a consumer culture so people entering retirement age really have to look out. You don’t want retirement to be a time of paying off debts. It’s supposed to be the time to relax. If seniors aren’t careful with their credit fees, you could see a credit crunch for seniors similar to what happened to the 2007 mortgage market.
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It’s a wildly different world than when Baby Boomers were born, as well as the time when Baby Boomers came of age. These kids today and the music they listen to: it’s all noise. Wait a second…did I just say that? It’s also a much different financial world, a time when people use plastic to pay for almost everything. Kids today are much more accustomed to this plastic-heavy world, while Boomers could potentially have more trouble with mounting debt, as we were raised paying with cash. Issues for Baby Boomers The good news is that the Baby Boomer generation is now reaching their full earning potential. At the same time, Boomers know that they need far more than their parents did to retire comfortably. Not only will Boomers live longer than their parents’ generation, but it’s a much more expensive world. Like it or not, Boomers have also, on the whole, shed the non-materialistic credo of the hippie generation and are in love with gadgets, nice cars, and other pricey comforts. For all these reasons, Boomers have been shown to be a top demographic for credit card offers.
Personally, I’d like think that I’m not completely materialistic, but I do like to live comfortably. I’ve had my time of dancing in the mud (not really, but figuratively) and now that I’ve settled down, I do want some of those creature comforts. I’m still socially conscious, but I’m not exactly screaming slogans in the street either. So my life has changed, as it has for a lot of other people in my generation. I’m a grandfather, I’m looking at retirement, some of my priorities have changed.
When I was younger, I hardly thought about financial responsibility. Then again, I didn’t have to. For two years, I lived in a tiny closet of a room for $20 a month. Now, I’m looking at retiring comfortably, and to do so I know it’s a good idea to get a handle on my credit card rates, as a good credit card plan will let me retire in style above what I’ve amassed throughout my life in liquid cash. For those of you looking to retire using credit cards, as well as retirement plans, it’s important to get your credit profile in order, pay off old debts, and empty out that credit card account so you can charge things to the card without knowing you’re going past your limit. If you're credit's healthy, as it hopefully is after years paying off debts, you can also apply for a high-limit credit card. That way your golden years will be all they can be.
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I recently wrote an entry saying that you should not be too free and easy with credit cards: opening up ten different credit card accounts isn’t the best idea unless you have a firm idea of how you’re going to pay them all off. Unfortunately, some people just can’t resist a new credit card offer. Here’s a new mantra, “Nothing in the world is certain except death and taxes and getting new credit card offers.” You’re going to get them regardless of how you’ve paid off your debts in the past.
Here’s a secret: credit card companies want you to default. They can cover the cost of you not paying off your bill of past purchases. But anytime you default on your bill, your finance charges and interest rate can go way up, meaning a huge percentage of your bill is not going to your credit card balance, but is going straight into the credit card company’s pockets.
But this is supposed to be about the sunny side of paying for things with credit cards. Credit cards rule. The sheer fact that you can buy a new iPhone in installments, rather than all at once, is a great advantage. Most often, credit disasters occur on the cardholder’s end. The cardholder doesn’t pay the bill on time, or pays the minimum, and has trouble getting out from under debt. While there are bad credit card deals out there, much of the responsibility is on the cardholder’s themselves: to read the fine print and to know your limits.
Newlywed Spending
This is a very important issue for newlyweds for a few reasons: newlyweds comprise one of the greatest demographics for new credit card offers. Newlyweds are young, more stable financially than single people (two incomes instead of one, much of the time), while still keeping up the spending habits of single people: a lot of nights out, gadget-buying, and other entertainment expenses.
Newlyweds have the extra added need of building a solid credit history to help with getting a good interest rate on a mortgage in the future or other important loans, such as a car loan. For this reason, credit cards can kill two birds with one stone: both improve quality of life in the present and the future. |
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