Page 25 - ARUBA TODAY

BUSINESS Tuesday 20 November 2018
A25

Volatile stock market spooking some older workers, retirees

By ANDREW SOERGEL down debt as the recov-
The Associated Press ery got underway, she
CHICAGO (AP) — The re- says, which tied up money
cent turbulence in the U.S. that otherwise would have
stock markets is spooking been saved or invested.
some older workers and re- "They had other things to
tirees, a group that was hit do with their money, even
particularly hard during the if they didn't lose their job,"
most recent financial crisis. she says. "Saving is sort of a
There's no indication, luxury good. It's what you
though, that the recent can do when you can pay
volatility has brought about for everything else."
large-scale overhauls in re- And with a limited number
tirement planning. of working years ahead
"There's a lot of fear that if of them — and, in some
you have another event cases, their peak earning
like 2008 and you retire the years largely behind them
year before or the year af- — many older Americans
ter, you're screwed. I'm not haven't managed to re-
taking that risk," says Mark plenish their depleted re-
Patterson, a recently retired tirement and savings ac-
patent attorney from Nash- counts.
ville, Tennessee. "There's a Attorney Mark Patterson poses in his law firm's offices Thursday, Nov. 15, 2018, in Nashville, Tenn. Mark Hamrick, the Wash-
huge fear of folks my age Associated Press ington bureau chief and
that they're going to run says the market fluctua- years in 2013. Indeed, memories of the senior economic analyst
out of money and they're tions throughout 2018 look Now, 68, Patterson says he recession continue to take at Bankrate, notes that the
going to need to rely on less like the prelude to a re- still has some "discretionary a financial and psychologi- Federal Reserve's ongo-
the government for help." tirement savings crisis and spending" money invested cal toll on many of those ing efforts to boost interest
By the time the market more like a return to nor- in stocks and riskier assets. who were affected. rates benefit savers with
bottomed out during the malcy after a remarkably But he says he was reluc- "There is no evidence that money in the bank but
financial crisis in 2009, an steady market run. tant to put too much mon- retirement wealth has im- also make it more difficult
estimated $2.7 trillion had As such, he hasn't seen ey into a stock market that proved in the last few for those with debt to pay
been wiped out of Ameri- much evidence of Ameri- soared throughout 2017, a years," says Teresa Ghilar- back what they owe. The
cans' retirement accounts, cans drastically altering decision he says was driven ducci, a labor economist, "rising economic tide" has
according to the Urban their retirement plans. "We in part by memories of the professor and director of been a boon for many, he
Institute. Older Americans, get the feeling that folks 2008 financial crisis. the Retirement Equity Lab says, "but it doesn't lift all
in particular, have had a are getting more comfort- "I can retire in 2018 and at The New School. For boats."
tough time recovering their able with volatility," he says. not be sweating bullets be- workers 50 to 65, there are He believes there's a ten-
losses. The Pew Research Patterson, the recently re- cause I put together a bud- indications wealth has ac- dency to "overgeneralize"
Center estimates the net tired patent attorney, grad- get and I protected it," Pat- tually fallen, she said. Americans' retirement situ-
worth of the median Baby ually began stepping away terson says. "The thing that Ghilarducci notes that ations and their day-to-day
Boomer household in 2016 from his law practice in the crash in 2008 taught workers and their employ- reactions to the economy.
was still nearly 18 percent 2016 — a decision he says me is that, even though my ers stopped or cut back "There can be a little bit of
shy of where it sat in 2007. was motivated in part by portfolio was well set up, on 401(k) and retirement a disconnect between the
In the two years since Don- the stress of his job, his rela- that was a black swan type account contributions im- improvement in the eco-
ald Trump's election, 62 tively stable finances and a of event. Even if you had a mediately after the finan- nomic data and the actual
percent of Americans — "re-evaluation of priorities" balanced portfolio, every- cial crisis. Many also opted experience of many Ameri-
and 76 percent of those 65 after losing his wife of 35 thing went down." to "deleverage" and pay cans," he says.q
and over — don't believe
their financial situation has
improved despite the run-
up in the stock markets,
according to a recent
Bankrate survey. Nearly 1
in 5 respondents said their
finances have actually got-
ten worse.
Paul Kelash, vice president
of consumer insights at Al-
lianz Life Insurance Co.,