Looking at the Financial Market in 2022 and Retirement

May 17, 2022

May 17, 2022: If you’ve started to lay out plans for your future retirement, you may have been wondering, how will the current market affect retirement? No matter your Retirement Strategy, there’s no denying that the current economic state and financial markets may affect your long-term planning. Additionally, it could affect retirement savings accounts.

Current Market Trends

To track current trends and prepare your plan based on up-to-date information, take a look at the ins and outs of the financial market and retirement.

Market Downturns May Lower Your Current Retirement Account Balances

Unfortunately, current market downturns could have at least a short-term impact on your retirement accounts. Also, it could dictate the balances of your other investments. When the market slows down, your accounts may depreciate. Some potential financial effects of the current financial market could include the following:

  • Your investment portfolio may decline in value
  • You may not be able to access high rates on savings accounts and certificates of deposit
  • Might have to change your long-term growth strategy
  • You may have less money to put into savings or investments

You May Need To Diversify Your Portfolio To Lower Your Overall Risk

In times of market downturns, portfolio diversification is more crucial than ever. For instance, if you currently have all or most of your retirement savings invested in one place, you may be at a greater risk of getting battered by downturns. On the other hand, you won’t be as affected by drastic drops in one area by spreading out your money. To lower your overall risk in turbulent financial times, it may be helpful to:

  • Place some money into a high-yield savings account*
  • Create an investment in bonds*
  • Invest in stable stocks that have been doing well*
  • Invest in mutual funds and index funds*

Avoid Panicking, Continue Investing, and Modify Your Budget If Needed

If you have invested in the current market, the best thing to do is stay calm. Despite market ups and downs, remaining patient and not panicking is crucial to prevent sudden moves that could hurt your retirement portfolio later. Although your exact approach may vary based on how close you are to retirement, a few tips can help you ride out current market downturns. In particular, make sure you:

  • Avoid pulling all of your money out of investments on a whim
  • Consult with your financial advisor to devise a calculated long-term strategy
  • Try to reduce your current spending if necessary
  • Adjust your projected retirement budget and boost savings whenever possible

As you lay out your Retirement Strategy, it’s essential to consider the current state of the financial market and potential future trends. Understanding the developments outlined above could help you put together a comprehensive, realistic, and viable retirement plan for yourself.. Use this guide to diversify your portfolio, modify your budget, and adjust your investment strategy to prepare your plans for your dream retirement.

*Consult your financial investment advisor.

About 1891 Financial Life

At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.

Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.