Sell Shares

The aging population also may hold down stock values for the next two decades as boomers sell shares to finance retirement, according to a Federal Reserve Bank of San Francisco research paper released Aug. 22.

"The mentality has shifted to preserving wealth rather than growing wealth, with less-risky portfolio allocations," said Emily Sanders, president of Sanders Financial Management Inc. in Norcross, Georgia, whose largest group of clients is aged 55-65. A typical 65-year-old may have 50 percent of his portfolio in stocks, which would drop to 30 percent at age 80, she said.

Faucher forecasts changing demographics will lead to a period when nominal GDP growth -- which includes the impact of inflation -- slows to 3.3 percent compared with 5.5 percent before the 18-month recession. That means the rise in corporate profits and equity prices would slow to about 3.3 percent from 5.5 percent as well, he said.

Aging Population

An estimated 72 million people, or 19.3 percent of the population, will be 65 and older by 2030, compared with 40 million, or 13 percent, in 2010, the Census Bureau estimates.

While new college graduates will assume some jobs as retirees leave the workforce, young adults' share of the population is shrinking. By 2030, there will be 34 million people aged 18 to 24, representing 9.1 percent of the population, down from 9.9 percent in 2010, according to the Census Bureau. The share of people aged 25 to 44 will drop to 25.5 percent from 26.8 percent.

"We are at the threshold of retirement mountain: a huge, huge change in the numbers of people who are reaching the age where they are leaving the labor force," said Neal Soss, chief economist with Credit Suisse Holdings USA in New York.

While losses from declines in the value of 401k and similar accounts may force some to delay retirement, these delays will be temporary, he said.

Work Longer

"Maybe one of the solutions here is that they work a year or two longer," he said. "Do we really think we are going to have a lot of 80-year-olds in the workforce? It sounds good until you start thinking about the practicalities of it."

The baby boom, the population bulge born after World War II between 1946 and 1964, added 9.4 million people in the 16-24 age group during the 1960s and 7.3 million in the 1970s. The percentage of women in the workforce almost doubled to 60.3 percent in 2000 from 33.6 percent in 1953, according to the Labor Department.