BlackRock Inc. Chief Executive Officer Larry Fink warned of a looming "retirement crisis" facing the U.S. and called on baby boomers to help younger generations save enough for their own futures.
That, he said, will prevent them from becoming disillusioned with capitalism and politics in coming years.
With people living longer lives but struggling to afford them and plan properly, Fink used his annual letter as chairman of the world's largest asset manager to urge corporate leaders and politicians to pursue "an organized, high-level effort" to rethink the retirement system. More than half of BlackRock's $10 trillion of client assets are managed for retirement.
"It's no wonder younger generations, Millennials and Gen Z, are so economically anxious," Fink wrote in the letter to BlackRock investors Tuesday. "They believe my generation – the baby boomers – have focused on their own financial well-being to the detriment of who comes next. And in the case of retirement, they're right."
Young people "have lost trust in older generations," Fink wrote. "The burden is on us to get it back. And maybe investing for their long-term goals, including retirement, isn't such a bad place to begin."
Fink said members of the boomer generation in positions of corporate leadership and politics have an obligation help fix the system, and he questioned whether age 65 should still be the conventional notion of when people retire.
Individuals are eligible for Social Security benefits as early as age 62, and those born after 1960 are considered at full retirement age at 67. Medicare health insurance coverage starts at 65.
"No one should have to work longer than they want to," Fink wrote. "But I do think it's a bit crazy that our anchor idea for the right retirement age – 65 years old – originates from the time of the Ottoman Empire."
By mid-century, a sixth of people globally will be over 65, up from 1-in-11 in 2019, Fink said, citing data from the United Nations. Almost half of Americans age 55 to 65 didn't have money in personal retirement accounts, he said, referring to 2022 US Census data.
"The federal government has prioritized maintaining entitlement benefits for people my age (I'm 71) even though it might mean that Social Security will struggle to meet its full obligations when younger workers retire," Fink wrote.
