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The only issue I take with this article is their seemingly blase take on the risky investing behavior of Gen Z. Sure, if that's the lay of the land then use it

The only issue I take with this article is their seemingly blase take on the risky investing behavior of Gen Z. Sure, if that's the lay of the land then use it to your advantage. But it seems a bit predatory. Risky activities tend to hurt more investors than they help, and lead to a small number of big winners and many losers. You can't just increase risk and increase reward for everyone. Regarding the predicament Gen Z is in, just remember that the older generations - one of which is very large - will need to sell their assets at some point. I know it's hard to hear, "Be patient" when you are young and have already been patient, but demographics is working against asset values in the next twenty years or so.

SimonPStevens 6y ago
> demographics is working against asset values in the next twenty years or so. As someone who is about half way towards retirement, how is it best to work with this? My future retirement income seems to be mostly dependant on having the right selection of investments for my pension account to grow in time for when I stop working. It's currently split between a few low cost, broad indexes. But if we expect asset values to go down as older generations sell off, am I going to see this pension pot fail to meet what I need it to in order to cover my retirement. My pension advisor just seems to blindly follow the script of 'passive beats active', and expects 5% annual return. Which I just go along with, mostly because I have no idea what else to do. Am I being too pessimistic when I really can't see 5% return being likely. How do I go about making sure my retirement is provided for. It kind of annoys me I have to seemingly be constantly figuring out the market situation to make decisions on what's best. Why do I need to be a stock market expert to manage my pension. What I'd much rather do is pay for a future pension more like an insurance plan. I pay monthly now, and some experts who know what they are doing worry about the investment strategy, and I just get a fixed pension payment.
- prirun 6y ago
  It sounds like you want an annuity. Your returns will likely be lower, with the issuer taking the risk (and getting the higher rewards), but you return is guaranteed and the issuer's is not.
  - acover 6y ago
    If assets perform poorly then how will the annuity be funded?
    - pram 6y ago
      The issuer funds it. It’s like an insurance policy. They’re contractually obligated to meet the terms (if the benefit is defined)
      - tonyedgecombe 6y ago
        Presumably if the market was bad enough there would be a point where the issuer couldn't meet the terms.
        jdhzzz 6y ago
        Then the business/economy probably has larger problems that will be addressed (successfully?) by the government.
        deleted 6y ago
        [deleted]
- cj 6y ago
  I can see a future where the US becomes much less restrictive with immigration (perhaps even promoting it) if the population of working adults drops significantly.
- Spooky23 6y ago
  As you get older and look for lower risk exposure, you start looking at simple annuity products. Preferably wait till this period is over and rates rise. If there’s a salesman eager to speak to you, you’re looking at the wrong product.
jchanimal 6y ago
So where to put cash?
- jackcosgrove 6y ago
  It depends on how soon you would need it. If saving up for a down payment expected within the next ten years, not stocks. Otherwise stocks.
  - jdhzzz 6y ago
    Not a binary choice. Whatever lets you sleep at a zeroth order approximation. Some cash, some (most?) index fund(s). And if there is enough and you have the inclination: YOLO.
almost_usual 6y ago
> Regarding the predicament Gen Z is in, just remember that the older generations - one of which is very large - will need to sell their assets at some point. Probably not all of their assets though. Most people don’t get a death date after 65. I guess if people want to blow most of it before 80 that might make sense but you never know when you’re going to go. Still need to hedge against inflation.
- acover 6y ago
  Also a significant amount of assets are owned by the wealthy and won't go towards retirement.
schemescape 6y ago
> the older generations - one of which is very large - will need to sell their assets at some point. Some of their assets (mainly houses, I’d expect). Anything they don’t sell can pass to their heirs and likely will even get a tax break (step up in basis) instead of a tax hit (estate tax exclusion is huge, at the federal level).
Fomite 6y ago
This was my reading as well. "They have a larger appetite for risk because the deck is stacked against them, and they've never seen a crash" feels like "We created a system where the young are desperate and are going to end up holding the bag" while containing no self-reflection on that.
tonyedgecombe 6y ago
>demographics is working against asset values in the next twenty years or so I can't find the link now but I saw a recent paper that showed retirees aren't really spending down their investments in old age. Rather many of them will end up with more when they finally fall off their perch.

SimonPStevens 6y ago

> demographics is working against asset values in the next twenty years or so. As someone who is about half way towards retirement, how is it best to work with this? My future retirement income seems to be mostly dependant on having the right selection of investments for my pension account to grow in time for when I stop working. It's currently split between a few low cost, broad indexes. But if we expect asset values to go down as older generations sell off, am I going to see this pension pot fail to meet what I need it to in order to cover my retirement. My pension advisor just seems to blindly follow the script of 'passive beats active', and expects 5% annual return. Which I just go along with, mostly because I have no idea what else to do. Am I being too pessimistic when I really can't see 5% return being likely. How do I go about making sure my retirement is provided for. It kind of annoys me I have to seemingly be constantly figuring out the market situation to make decisions on what's best. Why do I need to be a stock market expert to manage my pension. What I'd much rather do is pay for a future pension more like an insurance plan. I pay monthly now, and some experts who know what they are doing worry about the investment strategy, and I just get a fixed pension payment.

prirun 6y ago
It sounds like you want an annuity. Your returns will likely be lower, with the issuer taking the risk (and getting the higher rewards), but you return is guaranteed and the issuer's is not.
- acover 6y ago
  If assets perform poorly then how will the annuity be funded?
  - pram 6y ago
    The issuer funds it. It’s like an insurance policy. They’re contractually obligated to meet the terms (if the benefit is defined)
    - tonyedgecombe 6y ago
      Presumably if the market was bad enough there would be a point where the issuer couldn't meet the terms.
      - jdhzzz 6y ago
        Then the business/economy probably has larger problems that will be addressed (successfully?) by the government.
        deleted 6y ago
        [deleted]
cj 6y ago
I can see a future where the US becomes much less restrictive with immigration (perhaps even promoting it) if the population of working adults drops significantly.
Spooky23 6y ago
As you get older and look for lower risk exposure, you start looking at simple annuity products. Preferably wait till this period is over and rates rise. If there’s a salesman eager to speak to you, you’re looking at the wrong product.

jchanimal 6y ago

So where to put cash?

jackcosgrove 6y ago
It depends on how soon you would need it. If saving up for a down payment expected within the next ten years, not stocks. Otherwise stocks.
- jdhzzz 6y ago
  Not a binary choice. Whatever lets you sleep at a zeroth order approximation. Some cash, some (most?) index fund(s). And if there is enough and you have the inclination: YOLO.

almost_usual 6y ago

> Regarding the predicament Gen Z is in, just remember that the older generations - one of which is very large - will need to sell their assets at some point. Probably not all of their assets though. Most people don’t get a death date after 65. I guess if people want to blow most of it before 80 that might make sense but you never know when you’re going to go. Still need to hedge against inflation.

acover 6y ago
Also a significant amount of assets are owned by the wealthy and won't go towards retirement.

schemescape 6y ago

> the older generations - one of which is very large - will need to sell their assets at some point. Some of their assets (mainly houses, I’d expect). Anything they don’t sell can pass to their heirs and likely will even get a tax break (step up in basis) instead of a tax hit (estate tax exclusion is huge, at the federal level).

Fomite 6y ago

This was my reading as well. "They have a larger appetite for risk because the deck is stacked against them, and they've never seen a crash" feels like "We created a system where the young are desperate and are going to end up holding the bag" while containing no self-reflection on that.

tonyedgecombe 6y ago

>demographics is working against asset values in the next twenty years or so I can't find the link now but I saw a recent paper that showed retirees aren't really spending down their investments in old age. Rather many of them will end up with more when they finally fall off their perch.