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On June 23, 2016, the UK decided their economy was WAY too good. Jobs were everywhere. Housing prices were astronomical. And the pound was rockin’.
Clearly, something had to be done.
So they idiotically voted to break up their decades-long union with the rest of Europe, a move that is increasingly starting to look like it will break up the UK itself as Scotland and Northern Ireland panic and threaten to jump ship. I thought the U in UK was supposed to stand for United?
In just one day, the FTSE fell 8%, the Dow plummeted 600 points, and the pound sterling took a nosedive falling to a 31 year low.
Nervous Brits quickly cancelled their home purchases, terrified they’d lose their jobs.
And they should be terrified. By breaking ties with the EU, the British workforce loses the ability to work in 27 countries, and big international companies (like HSBC and Morgan Stanley) are making plans to leave the UK, taking thousands of jobs along with them.
So if that’s the outcome, why would the Brits do this? Why would they shoot themselves in the foot?
Because they’re Boomers.
No, I’m not kidding.
More than 75% of Millennials voted to stay, but the Boomers wanted out. And for what? To keep out the refugees? Those poor, exhausted, hungry Syrians who are somehow simultaneously stealing British jobs while also mooching off welfare?
The Millennials voted for unity, economic prosperity, and empathy. But the Boomers voted for bigotry, ignorance, and distrust.
So after waking up to find that their country had suddenly been plunged into recession by the Boomers (once again), our generation had this to say:
“The younger generation has lost the right to live and work in 27 other countries. We will never know the full extent of lost opportunities, friendships, marriages and experiences we will be denied. Freedom of movement was taken away by our parents, uncles and grandparents in a parting blow to a generation that was already drowning in the debts of its predecessors.”
“A generation given everything: free education, golden pensions, social mobility, have voted to strip my generation’s future.”
“This morning we have woken up to discover that the Baby-boomer generation – as they start to retire on their final salary pensions after lives spent benefiting from comparatively tiny state pension costs, from EU membership, from record trade, from skyrocketing house prices – have given us one final parting kick in the teeth.”
Thanks, Boomers! Once again, you’ve managed to kick us while we are down. But of course, you couldn’t give two shits about that. Not while you’re in your multi-million-pound house, tossing back a 15 year-old Scotch, paid for by your EU-funded pension. You’ve already won.
And don’t think this is just a United Kingdom thing. This is happening on this side of the pond too. The same Boomer bullshit is happening with the Trump supporters, who are feeding off the same anti-immigrant rhetoric, ready to destroy our economy with one pen stroke.
And once again, Millennials will be left holding the bag, and the Boomers won’t lift a finger to help.
After all, Millennials don’t need your help, do they? We just need to stop our incessant whining, roll up our sleeves, and solve our own problems (THAT YOU CREATED). It’s a dog eat dog world after all.
Well, you know what?
You’re right. We don’t need your help.
We aren’t going to take your bullshit anymore.
We’re going to start our own revolution and take back our lives, just like you’re trying to “taking back Britain”.
And how are we going to do that?
With our own F.U. money.
Because when we have F.U. money, we’re not relying on you to sell us your houses, or on companies to chain us to a job.
Our portfolio continues paying us, even as your houses are plummeting. And they will continue paying us even as companies are fleeing the UK.
And that’s why a diversified portfolio works. Instead of putting everything into 1 risky asset, like a house, we have bonds to dampen volatility, a cash cushion for rebalancing, and dividends that pay us.
While the FTSE lost 3.15%, the S&P lost 3.59%, and the DAX lost 6.8% all in 1 day, our 60/40 portfolio is only down 1.5%.
That’s right.
While the whole world is panicking, and Britain lost 125 billion pounds in 1 day (that’s 15 years of EU contributions!) our portfolio remained steady, continuously paying us dividends.
We don’t have to worry about losing our jobs or our house. We can rebalance as we see fit, and buy into the storm. All the while continuing to live off the yield.
Property owners in London, on the other hand, could expected to see their values plummet 18%, through NO FAULT of their own.
In the midst of what investor’s would call “Black Friday”, our 60/40 portfolio is doing just fine.
But what about the other allocations? What about 75/25 and 90/10 (with equities diversified across CAD, US, and EAFE)?
Well, let’s see…
- 60/40
- down 1.5%
- 75/25
- down 2.5%
- 90/10
- down 3.3%
Even with the riskiest 90/10 portfolio, the losses are nowhere near as catastrophic as an 18% crash in housing. That’s the power of diversification.
Our portfolio has survived all of these volatile events:
- Great Financial Crisis in 2008
- Grexit in 2012
- Oil Crash in 2015
And it will survive this too.
As will the Millennials, and we’re going to come back stronger and more resilient than before.
Because we’re going to STOP letting the Boomers win.
From now on, we’re going to:
Stop buying their overpriced houses.
Stop tying ourselves to jobs that feed their fat pensions.
Stop following their dreams, only to have it crush us, and then get kicked in the teeth while we’re down.
We’re going to fight back. We’re going to build an arsenal of FU money. And we’re never going to let the Boomers screw us over again.
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Some good points. The voting data was extremely interesting. It continues to demonstrate that the values of the boomer and younger generations continue to diverge.
Clinton will win the US election & the S&P 500 will go much higher – probably ahead of the election when it becomes more and more obvious. One must be invested in the US…
Real estate will be dead money for 1-2 decades.
Yeah, that’s the only sensible bet we can make. Clinton wins and everyone’s fine. But if Trump wins, we’re in the Hunger Games. Investing, houses, and jobs will be the last things on our minds as we fight for shotgun shells and the zombie hordes.
Millennials have got to promote the need to vote amongst their own generation. As do the GenX, Y, and Zs. Polls had Remain ahead yet Leave won; either the polls methodologies were incredibly incorrect, or Remain-ers, thinking the vote was already won, decided they didn’t need to vote and stayed home.
If you have a friend who’s meh about an election, make sure they go and vote.
Loving the blog, keep up the good work.
Since you and wanderer retired at a young age, it won’t effect you, or not nearly as much, but i’d love to hear your thoughts on the CPP changes they have discussed about bringing in. I don’t think the details have been finalized, but obviously enough of the provinces have agreed, it’s just inevitable.
I’m doing my best to sock away money for an early retirement, but i think i’m only looking at 30-40% of my income going in to retirement investments currently. the whole concept of CPP is not something I plan on relying on, but it still frustrates me that if i retire early (probably closer to 50 for me) that i would then have to wait until 60 at the earliest (I haven’t looked closely at the rules, so apologies if i’m wrong) to start getting this money. Yes it’s a small part of the retirement money, but it’s still my money that would be held captive by the government.
“i’d love to hear your thoughts on the CPP changes”
– I see it as a “forced savings” plan that doesn’t solve the problem of people’s bad financial habits. Only educating ourselves on money will fixed that. Also, this completely counteracts the tax breaks for the middle class promised by “PM Dreamboat”. Thanks a lot, Justin.
“the whole concept of CPP is not something I plan on relying on, but it still frustrates me…Yes it’s a small part of the retirement money, but it’s still my money that would be held captive by the government.”
– Exactly. This is why we can’t rely on the government to make the right decisions and take care of us. We need to control our own finances and take care of ourselves. (And no, I’m not a republican)
I suppose considering what I’m about to say it would help if I gave a little detail about myself first. I’m a Millennial, regardless of whatever definition or start year you go with, but am near the starting edge (mid 30s).
For the most part I like the blog and like the information you’re providing on it. That said, I’m taking issue with this post. The reason? You’re blaming the Boomers far too much in this case. Did they vote themselves out of a union that has helped protect themselves from another devastating war for the past 50ish years? Absolutely. Was it predicated on xenophobia and an attempt to control “their” country, yep. But they can only share the blame in this.
Yes, 75% (give or take) of 18-24 year olds wanted to stay however… http://www.bbc.com/news/uk-politics-eu-referendum-36574526
“It is a matter of fact that the older you are, the more likely you are to make the effort to vote – 78% of those 65 or over voted in the 2015 election, compared with 43% of 18-24 year olds and 54% of 25-34 year olds”
So a little over half of people my age, who were able to vote did. Less than half of those who were younger and able to vote voted. This is why they got screwed, because not enough of them took ANY ACTION, possibly thinking that someone else would do it for them or their vote didn’t matter? I have no good idea why they didn’t go and vote, but if that 75% wanting to stay extends to those that didn’t vote, they did it to themselves, and it serves them right.
Should we be force fed crap from the Boomers (and other generations too) who keep changing the rules to make their lives better at the expense of others? No. But in this case, I think the youth are more at fault here for not doing what was necessary to stay, they could have won it for Remain.
Your whole idea is for Millennials to step up and do it for themselves because they won’t get any from their parents, except for a pile of debt, and that needed to be applied here and wasn’t, so what they get (removal from the EU) is a result, but the fault lies largely on them, and unless and until they see that they will keep getting screwed over.
Correct. More Boomers voted than Millennials. However, I have to argue that it’s a HELL OF A LOT easier to get out there and vote if you’re retired, sitting around, and bitching about immigrants with your equally racist Boomer friends. The Millennials are too busy working and paddling hard to keep their heads above water to pay attention.
Sure, that doesn’t completely excuse the lower Millennial turnout, but it also doesn’t excuse the fact that Boomers CHOSE bigotry and selfishness over their children’s future.
Or maybe the Millenials, waiving the vote, aren’t even equipped to vote in the first place:
https://pushingrubberdownhill.com/2016/06/29/brexit-the-village-elders-have-spoken/
Sure, the Millennials could’ve had a higher turn out, but that still doesn’t excuse the Boomers from voting to destroy their kids’ futures. Boomers don’t have to worry about losing their jobs. That’s what gold-plated pensions are for!
“Of course there’s a massive difference – young people are completely stupid.”
I can say the same about old people. Sure, they have more life experience, doesn’t mean they learned from it.
Your rant is a bit ageist and alarmist.
Check out Tawcan’s blog – http://www.tawcan.com/thoughts-on-brexit/ – seems the Millennials didn’t deem it worthwhile enough to get out and vote – one could interpret that factoid as the millennials having screwed themselves.
One could also use the voting stats to ‘prove’ the rural folks screwed the city folks or that England and Wales screwed N. Ireland and Scotland and so on – focusing a single slice of data is generally not a good way to interpret an overall result. That said, a fair statement would be the British screwed themselves, as well as sucking the rest of us along with them.
That’s the trouble with democracy – one plays with dangerous goods without having had the proper training – simply drawing breath qualifies you (oh and having a reached a certain age 🙂
All that said, I think we can agree the Brexit vote has certainly increased uncertainty – as for how long and extent, that’s anyone’s guess and a foolish endeavour.
btw there was an article about another Millennial’s approach to life here
http://torontolife.com/city/life/spend-generation-manifesto/
which differs a bit from your perspective :).
And that is the beauty of democracy. We are all free to have our own perspectives 🙂
And while I agree that the Millennial turnout should’ve been higher, that doesn’t excuse the fact that the majority of the Boomers voted against their children’s futures. It’s like saying an abused housewife didn’t fight hard enough against her abusive husband. At the end of the day, her husband is still a dickhead.
The Brexit has definitely increased uncertainty, but it has also proven the resilience of a balanced portfolio. By using proper diversification, you are not putting everything in 1 risky asset, like a flat in London…which is about to get hammered.
On the plus side, maybe all this uncertainty will warn the US against voting for a populist and destroying the economy. Also, when markets fall, it’s a DAMN GOOD buying opportunity.
no comment re the other member of your cohort? 🙂
And the boomers (and lets not forget the generation (+65) before them – there’s still a bunch of them too) expressed their perspectives re the future of Britain – I’m guessing very few when so far as to think what the RAMIFICATIONS of those opinions would have – all they saw was “Britain great again” to paraphrase.
Ah democracy…it’s beautiful except when the Left don’t get the result they want:
http://www.rollingstone.com/politics/news/the-reaction-to-brexit-is-the-reason-brexit-happened-20160627?page=2
It’s not about anti-democracy. It’s about anti-lies.
Too many people voted NOT knowing what they were voting for. And many others were duped by the Leave Campaign, who are now backpedaling on most of their promises.
I may not be British but I know that when a popular vote gets tricked into believing lies, that’s NOT democracy. That’s called “being conned”.
That sounds like every campaign election, where the winning party backpedals on its promises – too numerous to list. Just type “broken promise” and [insert Party or leader name].
True, but this one was special in that not just some, but *all* of Leave’s major promises turned out to be a lie. And this situation is unique because the British people will have a chance to re-vote on this before it actually goes through, now knowing that the Leave campaign has no idea how to actually pull any of its promises off.
I’m actually surprised how quickly they revealed their hand that they had no idea what they were doing. What were they expecting to happen if they won? It’s almost as if they themselves weren’t expecting a win.
It pays to sock as much money away as possible, as fast as possible. I’ve always saved for retirement, but the last three years I’ve saved as much as I can. Except for Amazon. Amazon is my Achilles’ Heel. *hangs head in shame*
I’m nowhere near y’all’s portfolio tho’. *is sad*
Don’t be sad. That fact that you are even remotely interested in your finances makes you WAY ahead of many people. And besides, not everyone has to save as fast or as much as we did. Everyone has their own path to FI. That’s why we keep stressing the importance of building a side income. With just 10K/year, you can decrease your portfolio size by 250K. You just need to figure out your own path.
I am upset, because I have used the UK ability to live and work in the EU before. I was tentatively looking at other jobs “over there” and telecommuting for the fun of it.
You know, when I was about your age, the “baby boomer” chart-definition did not include me. Asked some older friends earlier this month if I, because of my age, was a “baby boomer” and categorically, the answer was “no”.
Wow, to my surprise, now Statscan and others use the years 1964 or 1965 as the end of the boomer generation.
So watch out – if I can be re-classed as a “baby boomer”, you just might someday be stuck in that classification, too!
😉
Actually, regarding the UK, we’ll see what happens, once the dust has settled.
I do worry that this is a long grinding bear market during which all assets fall in value. The money supply needs to contract or productivity needs to increase. Bond & stock returns could be unusually low for years until the excess capacity in the global economy is “worked off”. It would be hard to stomach zero or negative returns for the next few years… One simply does not know.
Most bear markets follow recessions and while the UK might’ve just created their own, the US economy is still clicking hot. The fundamentals are still good. I’m not saying it definitely won’t happen but if it does, we know what to do (stay calm, rebalance…like we did in 2008).
Hmmm – saw a graph on mondaynote.com, seemingly taken from the Economist, that it was the less educated that voted to leave, those better educated voted to stay.
If that’s true, then it’s the uneducated, NOT le Boomers that caused Brexit…
😉
You call them Uneducated, I call them Boomers. Potato, Potahto…
I guess you could paint the Millenials with the same brush …you seem to think castigating one generational definition (Boomers) as causing all the woes of the world – very narrow thinking don’t you think?
Yes, it seems that *ALL* millenials are hard working, educated, with a strong work ethic to boot. And all boomers are old, lazy and tyrannical bastards.
But hey, it’s their blog…we can all say what we want…let our own words display our ignorance (or brilliance).
(Ignorance is bliss though!)
Of course not all Boomers are the same, but the group that voted “leave” have an outsized economic and political power to make the lives of Millennials miserable, whether they intend to or not, with their massive housing gains, gold-plated pensions and higher political participation. And that’s why I’m worried for my generation. If we don’t stand up for ourselves, who will?
*if* the Economist is correct, and Brexit is caused by “education” vs. “age”, then it behooves all of us to *somehow* spread the word, regardless of birth date.
FIRECracker, I think you are on the right track, so this is not a put down, ok?
Earlier this month I talked to a 96 year old American who was so on the ball, it was scary. And, I talk to “kids” your age and younger some of which know what to do, and are doing it.
Maybe it is education? Maybe it is just getting out there and talking to those around you??? I don’t know.
I do know (broadly speaking) that financial knowledge is lacking, no matter what age group, but keep going with your education of the millenals. I’ll try to keep the local group of old farts up to date, whatever good that’ll do in the end! 🙂
Well said, ExGovtWorker! I do think that the lack of Financial education is hurting both the Boomers and the Millennials. Why is it that we had to learn about soil erosion in high school but I had never heard about indexing, rebalancing, or ETFs until I was almost 30? That has GOT to change. Let’s work together and spread the knowledge.
The FTSE did not fall to a 31 year low. It was lower just this January. The pound sterling fell to a 31 year low vs. the USD. That’s a rather glaring error for you to make, considering you’re all about promoting financial education. Did you really believe that when you wrote it? That the London Stock Exchange’s major index reached a 31 year low?
Good catch. My editor has been flogged as punishment.
I’m a millennial and I voted leave. I had also been waiting for the chance to vote for over 10 years, since my late teens, and I was always going to vote leave. For me it was always about basic principles: Sovereignty and Democracy. The EU is antithetical to both of those principles, and whilst other young people seem content to trade those in measure for the security, whatever that is, of the EU political institution that it apparently gives.. I was not prepared to continue that arrangement. I’d rather have a corrupt government at home than be dictated too by an organization beyond our borders that we can not get rid of.
What annoys me that most about the tone of your article, which is apparent in most young people who voted remain, is that all of a sudden you’ve all come out of the woodwork in support of a political institution that 12 months ago you probably had virtually no real understanding of. I’ve been talking about the dangers of the EU and its flaws for over 10 years.. not one young person my age in that time EVER challenged me or promoted the benefits of the EU. Not one. Now all of a sudden everyone is a fucking expert!
Give me a break. This is about more than money. Young people have become like their parents already.. all about the bloody money. You don’t actually give a fuck about anything other than your own personal well-being. Narrow, unenlightened, self-interest.
Correct. People who live outside the EU don’t understand all the nitty-gritty details of how the EU is structured. But seeing as how all the Leave campaigners promptly resigned after they “won” the vote, it looks like you guys don’t understand it either. You got tricked.
Wow… I dunno… that sure came across as a hate-filled, bigoted rant. I just discovered your blog but I think I just lost all respect for you.
I’m GenX, I’ve lived in the shadow of the Boomers all my life but at a closer perspective.
But you know, the Boomers were young once too. And they were famous for giving the finger to “the man” – Woodstock, marching on Washington, growing their hair, rebelling, doing all kinds of crazy stuff. And complaining about how the “establishment” was trying to force them into a mold that they refused to fit. And they got out and showed their rage, flexed their political muscles, and took on “the man”… I think *they* would have showed up at brexit to vote.
So rant away, rage against the Boomer.
But here’s the kicker, sweetheart. The Millenials are just like the Boomers. And the next generation can look forward to all the stupid stuff you do. And do stupid stuff, you will! Welcome to reality. I’m glad, as every generation has, that you’ve got someone to blame.
How much does growing your hair out and doing drugs at Woodstock count as “rebellion”? Probably more than I’m giving them credit for, but it’s still really easy to be rebellious when your society has handed you, at worst, a fair deal?
Even my dad has told me that he feels sorry for my generation. He told me years ago that when he was my age at the time, he had great job opportunities, stable pensions, affordable home-buying opportunities, and a valuable education. Today? Not so much.
Them growing their hair out and attending an antiestablishment music festival is not impressive to me when you grow up in an age where you will be well taken care of no matter what and then disparage future generations for not achieving the same standards as you when they were dealt an objectively worse hand.
Will we be the same when we take power in government? Saddling future generations with perpetual debt by raising debt ceilings and inflating our money to fund our wars and our retirement benefits? Perhaps. Heck, probably. But this isn’t Minority Report and we don’t get to be blamed for the crimes of the US Congress circa 2060. We can only speak of the here and now. And while one can’t truly paint EVERY person of any generation with a broad brush, nor can one claim that one generation is all evil while another is all good, I don’t think she was as far off as you think.
Disclaimer: I got no opinion on Brexit.
Sincerely,
ARB–Angry Retail Banker
The Baby Boomers screwing over the Millennials? Gee, you don’t say…….
Here in the US, Social Security is at risk. Current retires are OUTRAGED that Social Security only gave them a 1% cost of living increase. Meanwhile, I got a letter years ago from the Social Security Administration itself that if no policy changes are made, my generation’s BEST case scenario is to receive 77% of every penny we put in. A full refund and resulting disqualification from benefits is never going to be an option because otherwise how would the poor Baby Boomers that never bothered to save a penny in their lives be able to collect government benefits?
And suggest anything to a Boomer to protect the future generations, such as accepting no more COL increases in order to ensure the Millennials get what THEY put in, this ensuring that each generation at least gets dollar for dollar what they put in with no inflation taken into consideration? Oh I hope you have a hour, because you’re about to hear how us lazy Millennials are just looking for a handout from our parents for the entirety of that hour. How entitled of us, right?
I should point out that I am neither for or against Brexit, and Trump’s election wasn’t really a generational thing (plus I do understand his appeal even if I don’t support him myself, to say nothing about the low quality opponent he had). But I agree completely that it’s very sick and tiring to hear about how entitled the MILLENNIALS are when we could never hope to reach the entitlement of our generational predecessors. Entitlement spans all generations and I don’t think any generation has a monopoly or trademark on it, but if any generation does, it’s the one that mortgaged their children’s future for their own benefit and then complained that their children still haven’t moved out yet.
I share your righteous anger.
Sincerely,
ARB–Angry Retail Banker
*shakes fist* This is why we can’t expect the government or companies to take care of us. Gotta take care of ourselves. But as soon as I tell that to a Boomer, the response I get is “oh, so you’re too good for a job?” *screams and tears hair out*
Love the blog and you guys in general but I think this blog should stick to financial independence related material and steer clear of anything political. Every politically related blog I have read from you guys is extremely misguided, opinionated and frankly just plain incorrect. I’m a millennial.
Keep up the good work with the finance-related info and the travel series though. Really enjoy those.
Hello,
Your points are valid and your anger is understandable, but as a “Boomer” you are losing me as a reader. Perhaps, rather than singling out a group of people stereotyped by age, try focusing on the real villians: the super wealthy, and “conservative” voting/thinking people, regardless of age. Individual boomers are no more at fault than you, simply doing what you are doing: taking advantage of the economic situation left us by previous generations.
By the way, your world travel is ecologically destructive. But that will not stop you, will it? See you on the next plane 🙂
Cheers
This article is hilarious. It has everything backwards. The EU is the grand boomer project. Watch Blair, Mandelson and every fucking gammon-faced rentier gobble down statins at the prospect of the loss of endless minimum wage labour and the prospect of their property portfolio going underwater. Maybe all those fucked-over millennials will get a pay raise and a place to live now. Or maybe boomers like May, Hammond and possibly Boris will simply up-end democracy and delay and obfuscate in the hope that the BBC can garner enough enthusiasm for Remain to win a second vote.