(Please note that this article makes generalizations based on trends that I have observed. Obviously, there are many exceptions.)
In 1945, thousands of young men came home from World War 2, married the sweethearts who had been waiting for them, bought little houses with white picket fences in the suburbs, and started families. The children born during the population explosion became known as the Baby Boomers.
The first of the Baby Boomer generation came of age in the 1960s. They were invited to join a colourful, carefree hip new groove. Hippies dropped out of the establishment and dropped into a counter culture movement fueled by mind bending drugs and rock music.
Eventually, the hippies grew up, got out of rehab, married and had kids and careers. They settled down in the biggest homes the banks would mortgage for them, and materialism took over. Easy credit, payday loans, and credit cards fueled a play now, pay later way of life.
Earlier generations celebrated retirement with a mortgage burning party after spending their lives working and paying the bills. The Baby Boomer generation will be facing retirement with the highest personal debt load per capita ever. Credit companies are capitalizing on this situation by offering to finance retirement with reverse mortgage deals. One ad campaign currently running in Canada entices seniors with visions of sailboats and globetrotting and the slogan “never make a payment until you chose to move or sell.” The reality that the credit companies are banking on is that eventually everyone dies. Then they get possession of the home. The heirs have the option of buying back the home by paying off the loan.
Is it possible that the Baby Boomers can get away with taking their debts to the grave?