I watched a video that Mike Dillard created to launch his new program, The Elevation Group. In that video he makes many interesting points, and here is one of them that really stands out.
He states that when people reach retirement age, 65, they are required to start withdrawing 6% of their 401k. A financial advisor friend of mine told me that his numbers are wrong, it is actually about 3% at age 70.5. Either way, the point is still valid.
What this could mean as the Baby Boomer generation passes through the age at which they are required to start taking money out, a large number of stock shares are going to be sold on a regular basis, increasing the number of shares of these stocks available on the market. The Law of Supply and Demand states that as this supply increases, the price of these stock shares will fall.
The Baby Boomers right now range somewhere between 46 years old up to 64 years old based on the definition that Baby Boomers were born between 1946 and 1964. The oldest of this generation will have to start pulling out their 401k and IRA dollars in just 6 years.
As they start to pull out their money, as I said, the stock prices could fall because there will be more shares available and there aren’t enough people in the younger generations to buy them up with their 401k and IRA investments. As this happens, the people at the younger end of the generation will see their retirement funds start to just evaporate into thin air. A more extreme result could be a stock market crash. Kind of scary.
I guess my parents are lucky to be in the older half of that generation.
Mike Dillard is offering a new program to make the financial practices of the wealthy available to people like you and me. That’s what The Elevation Group is about. Register for the webinar here and see what else Mike Dillard has to say.
Disclaimer: I am not a financial advisor and I do not closely watch the financial markets. I cannot and will not tell you what you should do with your money. I just found this interesting and thought I’d share. Check with a real financial advisor to see how this might affect you.