Good Morning,
Attached is the most recent “By the Numbers” piece put together by MFS. The two facts that I highlight today discuss market returns following midterm elections and how many Baby Boomers are reaching retirement age.
“The S&P 500 stock index has gained an average of +15.3% in the 1-year following the last 17 midterm elections, i.e., change of the index’s value not counting reinvested dividends for the 1-year period following the midterm elections from 1950 through 2014. Each one of the 17 “1-year periods,” i.e., 100% of them, resulted in a stock market gain for the S&P 500” (source: BTN Research).
“An estimated 10,400 Americans will turn 65 years old each day next year (2019). This group represents the 9th year of 19 years of “Baby Boomers” turning age 65. An estimated 11,500 Americans will turn 65 years old each day in the year 2029” (source: Government Accountability Office).
The point about post mid-term election returns is not that we should expect this trend to continue in 2019. Instead, I would reiterate to clients that the results of the elections and possible “changing of the guard” in Washington is difficult to predict. More importantly, the forward looking return expectations are extremely difficult to predict and are generally driven by various factors outside of politics.
The fact about Baby Boomers emphasizes how many individuals are reaching retirement age on a daily basis. While this does not necessarily mean that everybody will be retiring at exactly age 65, it paints a picture of just how many individuals need to be prepared for life without recurring income.
Thanks,
Pete
Peter Malone, CFA
Research Analyst
Direct: 617.226.0030
Fax: 617.523.8118
Crestwood Advisors
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Boston, MA 02109