The Economics of Boomerism: An Innovator's Guide

Baby Boomers at a crossroads between remaining in the workforce and retiringHere is a great post from Reuters’ Mark Miller on governing economic and social trends impacting Baby Boomers. Below are some thoughts on how these driving forces should translate for innovators:

Trend #1: An estimated 3 Million American Baby Boomers will retire overseas, driven by warmer climates and reduced standard of living expenses.  With fixed incomes from Social Security benefits still accruing to them and Medicare’s future uncertain, it’s clear that the non-familial incentives to stay in the US are declining, especially if other countries are providing more affordable, patient-centered, and immediate care. 

Opportunities for Innovators:

  • Help Boomers supplement Social Security income and company pensions, and offset living expenses, while still enabling them to retire earlier and enjoy many/most of the non-financial benefits of retirement.
  • Enable Boomers and their adult children to navigate their financial future after the death of a spouse/partner/parent.  Based on discussions with other innovators, it is clear that post-death planning—from estate and funeral planning to life insurance and income/investment management—is still a maze.  

These are markets that are ripe for disruption. We know a company still in stealth mode that is diving deep into this space and there are numerous ways to structure the business models so that it is affordable to the consumer and profitable for vendors.  

  • Help Boomers stay deeply connected to their adult children, grandchildren, and friends.   Skype and Facetime are great, but they still leave much to be desired.  Innovators need to figure out ways to improve family connectivity and facilitate social interaction and discovery, including making it easier for Boomers on fixed income to travel and stay mobile.   We still haven’t seen a travel site effectively targeting the 50+ market, even though this is a golden opportunity.  Just ask Jody Holtzman, Senior Vice President at AARP.

Dave Morin, Founder of Path and former Facebook employee, made an interesting split from Facebook, driving home the point that it is not really possible to use the 1 Billion-strong network as an intimate social tool for family members. In Morin’s words, “Facebook has built the cities, they’ve built the town squares, and they’re more of a general social network. Path, on the other hand, is more like the home, as if adding each friend is filling out your dinner table." While Path’s long-term viability is still in question, the spirit that Morin speaks of must be institutionalized in innovation.  

In the world of mobile, 90% of innovation touts “local and social,” but offers anything but. The signal-to-noise ratio in mobile innovation is terrible. We need to get better at this, and fast. iPads, smartphones, and embedded devices offer unprecedented opportunities for contextualizing family connectivity and enabling shared experiences.  Our friends at Kindoma are making strides to make storytelling, learning and sharing more interactive between grandparents and grandchildren, and we’re excited to see how they move forward. Above all, we MUST strengthen family relationships, especially as geographic separation increases.

  • Help the children of Boomers become financially independent: The recession hit families hard and this obviously spanned generations. Many children of Boomers are just starting to find their footing, especially the most recent college graduates. It's common sense that helping them will help their parents retire comfortably, and business model innovation needs to address this growing need. As the Reuters article points out, Boomers are borrowing and delaying retirement more than ever before.

If there’s a silver lining in the recession, it’s that change is no longer optional—financial technology innovators need to move faster to address the cross-generational burdens of the family.


Trend #2: Boomers are starting companies.  A Kauffman Foundation study found that in 2011, 21% of new U.S. businesses were started by Boomers compared to 29% for the 20-34 age bracket [Reuters].

Opportunities for Innovators:

  • AARP and the Aging 2.0 network are helping to catalyze Boomer innovation, and we’re excited about the future of entrepreneurship with Boomers at the helm. Do not count Boomers out of the innovation game, and find ways to partner with them.
  • Hire Boomers: If you’re targeting the aging market, it only makes sense to have team members who are smart, motivated, tech-savvy (yes, they're savvy), and dare we say represent your target demographic! What better way to understand your customers than to have your target audience collaborate with and advise you.

Trend #3: Boomers are going to live longer than previous generations. According to the Social Security Administration, “[for] a couple with above-average health, there’s a 60% chance one of them will live to age 90” [Reuters].

Opportunities for Innovators:

  • Beyond easing the general economic burdens highlighted above, there is a need to improve health coverage and ubiquitous care coordination for our at-risk Boomer population.  The economics of chronic disease management and trends are well-established; 75% of health care costs are attributable to chronic diseases (heart, diabetes, cancer, and COPD are the leading diseases and killers). Furthermore, disease progression and health decline will take longer—care coordination and providers need to adapt quickly to this aging trend.

Improving care coordination extends across payor, provider and patient. And it needs to extend way beyond the hospital and long-term care facilities. With delayed retirement becoming the reality, care coordination needs to adapt in the workplace (targeting self-insured employers), the car (the driving population is getting older), public spaces, and the home (telehealth and remote care monitoring). This is not just a technology challenge—it's one that requires major re-tooling of business models, architecture, urban planning, and public & private services.

Now more than ever, the economics of healthcare support aging in the home. Consumers want it, payors are starting to incentivize it, and providers are suffering the economic toll of crowded emergency rooms and extended inpatient stays. The Affordable Care Act has established economic and regulatory parameters for innovation, but the challenges of Boomerism demand that innovators stay one step ahead of Washington. This is not a time to equivocate or tread slowly. Entrepreneurs must step up and execute a future that is sustainable for the entire healthcare ecosystem.


The future of aging innovation depends on empowering Boomers and their families to make informed, navigable decisions about their retirement, mobility, connectivity, and health. Innovators are just scratching the surface—it’s time to dig deep!