ATLANTA — With the stock market’s volatility on Monday, many people in metro Atlanta wondered how to protect their retirement funds.
Channel 2 Consumer Advisor Clark Howard spoke with Channel 2′s Courtney Francisco about different investment strategies based on one’s age.
“For me, it’ll be good,” said Timothy Bankston, buying low. “I’m prepared to wait it out.”
Others, said they’re waiting it out because their loss is less risky.
“We’re getting close to retirement. If we feel like we need to do something, our advisor will call us,” Scott Jerald said. “We’re probably a little bit more protective, less risky.”
Howard said tariffs can be brutal and ugly for retirement plans tied to market performance.
“I find it almost impossible that the president will stay the course, that the tariffs will stay in place because the economic consequences are too severe,” said Howard.
He said the United States could become known as an island market.
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“Which means we will have permanently slower economic growth, lower quality goods, and higher prices on those goods,” said Howard. “We may have a few more factory jobs that pop up, but overall, the number of jobs in the United States will decline. This is a very serious event in U.S. history.”
Protecting your 401(k) investments
If you’re approaching retirement or in retirement, Howard says your portfolio should be conservative to avoid big loss.
“I’m widely diversified. I have money in cash available. I have bonds. I have domestic stocks. I have international. So, the risk for me is greatly reduced,” Howard said.
If you’re in your 50s, he said you still need stocks.
“You still need stocks because you need the long-term growth to outrun inflation, but you’re not all in on stocks. You need to be diversified beyond what most Americans think of that,” Howard said. “Owning funds that invest in companies outside the United States as well as in.”
If you’re in your 30s and 40s, it’s a different scenario.
“You keep putting money in that 401(k). You keep building because, even though our economic growth if we stay full on tariffs will be lower and slower, we will still have a growing economy. Just, in a lower gear than the rest of the world,” Howard said.
Monday, the stock market started off strong after some predicted the president would back down from his plan, but the day ended low.
“There’s a lot of scrambling going on that we’re not privy to in the Republican party and the White House seeing the dangers from this,” said Howard. “There’s a process going on, trial balloons, trying to move the president along to rethink this. So, we’re going to have a rumor-a-minute. So, wait for facts, wait for real information, before you make any decisions with your own money.”
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