Sunset of the grey nomad: a market perspective

Discussion in 'Markets & Economies' started by mmm....shiney!, Jun 17, 2012.

  1. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Is the era of the grey nomad drawing to a close? Will "the grey wave" close out? The "silver tsunami" break?

    Are we currently witnessing the last of a breed of retirees? The type that upon retirement, are still young enough, healthy enough and wealthy enough to do "the big loop". The majority of the current generation of retirees will witness the erosion of their wealth as well as their health over the next few years. Furthermore, the erosion of wealth may well further accelerate the decline in their health. The next crop of retirees are facing the possibility of a smaller nest egg with which to retire, and will be retiring later in life. They'll be financially and physically weaker - less capable of following their genetic code and travelling north.

    Take this shift in demographics and combine it with inflation in utilities and commodities and the days of the "last great migration" may well be doomed. In 10 years the waves of southerners jamming our highways doing 85kph will be an endangered species, and the specialist industries and small businesses in Qld, Nt and WA that have been flourishing and feeding on the fattened wallets of this annual migration north will likely decline as well.

    Goodbye caravan parks, roadside cafes, country restaurants, cheesy "Outback Experiences" and boosted memberships in local bowls and golf clubs. Not to mention caravan manufacturers and repairers, petrol stations, sat TV and HF radio suppliers and installers, potato scallop (cakes) manufacturers and makers of cheap bottled wine destined for consumption in "happy hours" in every caravan park across the country.

    If I owned a successful caravan park I'd be putting it on the market now. The phenomena that has been the grey nomad may well be endangered.
     
  2. wrcmad

    wrcmad Well-Known Member Silver Stacker

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    We might need caravan parks to provide affordable accomodation for the less well-off if the SHTF eventuates - like "trailer parks" in the US?
     
  3. Nedsnotdead

    Nedsnotdead Active Member Silver Stacker

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    Ive been to a few caravan dealers lately and the recent caravan and camping show. From what i have been told and can see Business is booming and majority of buyers are not grey nomads. Yes there are more grey nomads doing it tougher these days but i think there will always be people heading north for the winter months and those doing 'the lap'. Try getting a site up north over winter. Crazy from what ive been told!
     
  4. Dogmatix

    Dogmatix Active Member

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    You could be on to something Shiney, but I assumed exactly the opposite was likely to happen - Grey Nomad boom times!

    A caravan is cheaper than a house. Retirees have to get out for their sanity too I think. And if they sell their kids inheritance (house), as that generation is likely to do (i'm being offensive), then they'd may aswell spend it before going on a Govt pension.

    Most retirees will not have enough Super to get them by, so why not spend it?

    Anyway, I doubt I offered any kind of insight, I just think that if I was at retiring age, didn't know about precious metals and the economy, and didn't care about my kids inheritance, i'd probably drive around in an RV til I had no money left.
     
  5. jpanggy

    jpanggy New Member

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    @shiney

    I think the point on being less wealthy is plausible if the economy continues at this pace. Does not mean they will be good at managing their finances though, so not sure if this will spell doom for the caravan industry.
     
  6. Rothbard

    Rothbard New Member

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    Keep the caravan park!

    Affordable holidays will be popular amongst young families and your land maintenance is low compared with a motel etc.

    You can generate great cashflow from a well positioned caravan park while you work to get DAs in place to be sold on. Usually it is easier to get a DA for a higher density development on a van park site due to the existing use as opposed to vacant land.
     
  7. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    ^^^^^^^ 5 years of whoopee!!! and then it's on the pension.

    This will be the solution of the future:

    http://www.forbes.com/sites/ivancas...rlds-economic-woes-lift-retirement-age-to-70/

    I think he's referring to the age at which you may get the pension, I think it's currently 68 in Mexico (having been lowered from 70) rather than a mandatory retirement age.

    And am I really reading right????? Look below!!!


    Joe Hockey, London, April 17 2012.

    http://www.theage.com.au/national/the-end-of-the-age-of-entitlement-20120419-1x8vj.html

    Sell your caravan park now while the industry is still booming and before eminem's mum and boyfriend move in.
     
  8. rbaggio

    rbaggio Active Member Silver Stacker

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    Harry Dent has a lot to say on this topic of changing demographics (specifically, Baby Boomers retiring, not spending but saving, and the flow-on economic effects that this has)
     
  9. Guest

    Guest Guest

    As a generation X who has always lived in the shadow of my parent's generation, forced to pay for their largess only to see it ripped away before I'm 'entitled' to go claim it myself, all I can say is one thing.

    Screw you baby boomers!

    When the SKI holiday runs out, don't darken our doorsteps with your hands out you pieces of crap, you're not welcome!

    kk I'm done.
     
  10. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    ^^^ I was waiting for that :lol:
     
  11. bordsilver

    bordsilver Well-Known Member Silver Stacker

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    Although I read Harry's stuff a few years ago I forget whether or not he says this. I think it is important to remember that a big factor is the large amount of productive knowledge that will exit the labour force along with the baby boomers. Although us young folk can generally (not always) do harder physical labour and longer hours the oldies have a much richer ability of how to direct that effort for more gain.

    Abstracting from all the caveats, we can essentially take wages as a measure of the relative wealth generation. Then by noting that wages go up as you get older then then the world labour market will be shedding a greater proportion of its wealth generators resulting in less stuff per capita even if we replaced every retiree with a new graduate (which the western world+China won't be - so double loss).

    On top of this base is whatever spending/savings effects you wish to discuss which (I think) will be about changing the ratios of net asset buyers to net asset sellers.
     
  12. jpanggy

    jpanggy New Member

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    I am not sure if Australians are used to saving money. The most likely scenario is that they change their spending strategy and just spend less on luxury items and spend more on basic items. Also, they will continue to spend until death.
     
  13. Dogmatix

    Dogmatix Active Member

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    @Shiney

    I think there will be a push to increase the retirement age. But what will that achieve exactly?

    Regarding Joe Hockey, he's looking for the easy way out - unfunded retirement! It's a cop out really, but I don't entirely disagree. I think the notion of retirement will slowly die as its inability to be funded becomes more apparent.

    Ways they could achieve the death of Govt funded retirement:

    - pension increases don't match CPI
    - increase retirement age significantly, so that people stop expecting it
    - start offering foodstamps instead of pension payments

    The whole idea of Super was to take the pressure off the pension system, but the housing bubble helped to kill that idea.
     
  14. Jislizard

    Jislizard Well-Known Member Silver Stacker

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    There is a push to remove the retirement age...


    Encourage expatriate Australians in mid-career overseas to return to Australia through preferential tax
    treatment of retirement savings. The current arrangements make it hard for Australia to compete for
    talent. We need to encourage brain 'circulation'.


    It was noted that retirement is very damaging to health. In retirement older people need a reason to stay
    engaged. Consideration should be given to abolishing retirement and reinventing different types of
    productivity....


    Abolish retirement. The concept of retirement should be replaced with the notion of older people
    moving to other forms of productivity, and they need good health to do it. We need a new concept in
    which they need some type of health vision to achieve. Retirement would go as a notion. We are
    talking about new and different styles of participationnew forms of work, new forms of contribution.
    We are definitely living older and are generally healthier.


    From the 2020 Summit http://www.australia2020.gov.au/docs/final_report/2020_summit_report_full_low_graphics.pdf

    I read somewhere, it may have come out of this conference, that in 2020 something like 60% of the workforce is due to hit retirement age, and there are not enough people joining the workforce to replace them. Needless to say I can't find it now but it was causing a lot of concern in the Health Service.



    EDIT: Our local caravan park was bulldozed during the recent housing boom and is now several blocks of units. The nearest one has static caravans for about $580 a week off season, I 'll pass.
     
  15. Dogmatix

    Dogmatix Active Member

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    One problem with abolishing retirement that I can see is that people want to go on holiday and do the things they previously never had time to do.

    How can you balance that out?

    I'd love to say ' shorter work weeks', but not sure if it is feasible. Although if one day we get off the 'perpetual growth is good' train, then I see it as an inevitability. Unless some disaster kills half the population that is.
     
  16. bordsilver

    bordsilver Well-Known Member Silver Stacker

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    Nothing wrong with perpetual growth ESPECIALLY when it happens naturally and spontaneously via the market rather than the tainted, artificial growth we have experienced in recent times due to fraudster banksters and their enabling masters. Tainted growth at all costs is what creates true resource scarcity and destroys the quality of life for everyone (especially for the most vulnerable). Heck, this is why most of us are part of the sound money/free market cabal.
     
  17. Byron

    Byron Guest

    I have to agree with Auspm on that one.

    Far too many are still in the workforce and clogging up the system, leading to a dearth of jobs for Gen Xers.

    Even worse, some (particularly in the public service) are double dipping - "retiting", claiming very generous old scheme - defined benefit super entitlements (way better than our measly 9%) and then going back into the same job full time because of "connections".

    This should really not be allowed.

    Raising the pension age will make things even worse for the following generations. If people retired at 60 or 65 there would be more jobs available for younger people.
     
  18. hawkeye

    hawkeye New Member Silver Stacker

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    If you think about it you have so many people in the public service not producing much (yeah, I know I'm bashing them again :), but just to make a point).

    It seems to me, that if we sort of rebalanced, we could have everyone doing less work, ie. those who are doing a lot of productive work now do less, and those who are doing virtually nothing, but still working the 40-hour or so work week, would pick up the slack, same level of productivity, lower overall hours for everyone. Much of that time "working" where essentially nothing is being done gets removed meaning less hours worked in total. Maybe it's a pipe dream, but that's one of the major reasons I am for the free market. Take away the parasitic element and I actually think just about everyone would benefit. Could be wrong...
     
  19. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    By retirement age I suspect you mean pension age. It's currently 65 for the majority of workers (to be increased to 67 by 2023). Longer in the workforce = more taxable income = less time on government welfare. That's the theory. Will it work? I don't know.


    How about once you turn 65 any income earned is tax free? No pension, no seniors cards, no cheap bus fares but private medical cover becomes compulsory? Instead of a strain on the resources of the taxpayers of the nation they are given the freedom to govern their own destiny. Effectively they can have the keys to the nation - they live for free in this nation, only paying for what they consume and do as long as they insure themselves for their own medical expenses.
     
  20. Dogmatix

    Dogmatix Active Member

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    I did mean pension age, rather than forced retirement age. I think the latter is fairly redundant actually (maybe i'm wrong on that).

    I like the idea of the 65+ tax free time, but as Byron points out, there are too many older folks cloggin up the system! :)

    Plus then you could create a bias towards hiring older folk, who could probably ask for lower wages considering they wouldn't have to pay tax, and might even work part-time if they don't have a family to support anymore, etc.

    Turns out it's a fairly complex topic huh? I think the real problem is that no-one has bothered to deal with the issue 10, 20 or 30 years ago when it needed dealing with. You could argue that the Super system was designed for it, but it's not working out like that. No policy has come close to effectively dealing with (or even acknowledging) the glut of boomers retiring at the same time.

    As I said earlier about Hockey's admiration of China, I like this idea, and I think we're headed that way out of sheer necessity, but I can't think of a way to implement it?

    How do you change a system of entitlement, to a system of saving and preparedness... without a whole lot of hard learning inbetween?

    And how can you do it quickly, whilst not disadvantaging the current retiring generation by changing the rules on them? Is that important?

    And how can you expect people to save and be prepared, in a system that is volatile, using a currency that is volatile, and with a Govt that is volatile?

    Those questions aren't directed at you Shiney, they're directed at anyone who has an opinion on them :)
     

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