Baby boomers’ wealth will create a generation of millionaires, argues financial expert Peter Sharkey. 

Relishing the opportunity to embrace spontaneity, my wife and I secured a last minute holiday in Fuerteventura last week. One notable characteristic of the sunny terrace where we enjoyed lunch was the small forest of grey haired individuals. That’s right: the baby boomers were in town.

Labelled the ‘lucky generation’, baby boomers are regularly blamed for many of society’s ills, usually because it’s recognised that many of them (your correspondent included) benefited enormously from buying their first home during the 1980s. It was, undoubtedly, a risk that paid off – but it was no cakewalk, especially as interest rates soared and remained excessively high.

On January 1, 1980, the Bank of England base rate stood at an eye-watering 17pc. Othe following decade, rates never fell below 7.38pc (in May 1988) and, as the 1990s dawned, interest rates hovered stubbornly at a shade below 15pc.

By the time lenders had added a further 1pc or more, people with mortgages were likely to be paying interest of 16pc-17pc to keep a roof over their heads. Inevitably, millions struggled to keep up their mortgage payments and thousands had their homes repossessed. The 1980s were not a one-way ticket to easy money in the form of trouble-free property wealth – far from it. Indeed, anecdotal evidence suggests that a majority of mortgage holders often sacrificed luxuries such as holidays to ensure they kept their home.

Perhaps this partly explains why so many of the boomers’ generation who may be close to retirement prefer to remain in the workplace – not necessarily because they need to, but because they want to. They enjoy the work they do, benefit from keeping active and are delighted to generate a modest income which prevents them from having to tap into their pensions. Those years of ‘making-do’ in order to make sky-high mortgage payments have stood the boomers in good stead.

“Baby boomers come in for unnecessary flak,” says Ken Carter of personal finance website “But younger folks forget that people born between 1946 and 1964 have been responsible for embracing a range of societal benefits: the steady rise in volunteering, for example; for being firm advocates of social change and for high levels of activism. Boomers are considered lucky because they took collective risk 40-odd years ago, but we should not ignore their additional contribution to society.”

Boomers are also wealthy – the lucky generation control around 80pc of UK private wealth. Around 20pc of them are millionaires (the figure was 7pc in 2006), which explains why one 2022 estimate maintained that boomers’ offspring will inherit an astonishing £1.2 trillion from their parents, mostly in the form of property.

By 2035, more than a quarter of the UK’s population will be aged over 65, while the number of people aged over 85 is forecast to double to 3.2 million by the mid-2040s, with one in five people living to see their 100th birthday.

These are staggering statistics – a stark indication of how our lives have improved almost beyond recognition over the past 70 years. Today, people are much healthier because we all enjoy better food, housing and healthcare. We possess mind-boggling computing capability in our mobile phones and can jet off to places like the Canary Isles for some winter sunshine.

Boomers deserve considerable credit for this. Their efforts have made a sizeable number of them wealthy – and ultimately, the principle beneficiaries of this wealth will be their children.

For more financial advice, check out Peter Sharkey’s regular blog, The Week In Numbers.

This column is for general information only and cannot be relied on as financial advice for individuals. Consult your professional adviser.