(WXYZ) — Four specific things could affect your retirement and retirement savings in 2022.
A recent survey [thepennyhoarder.com] found 67% of Americans’ retirement savings have not changed at all during the COVID-19 pandemic. The survey also found 17% are saving less and 16% are saving more for retirement during the pandemic.
While a majority have seen no change, local financial expert, Gina McKague of McKague Financial [mckaguefinancial.com] in Livonia, shares the four things that could affect your retirement and retirement savings in 2022.
Interest rates are at their lowest point since the creation of currency thousands of years ago. We have continued heard that they cannot go lower, but when will they rise? If they stay at record low levels, consumers only have so many options that they may utilize to grow their money in safe places. Get a second opinion on where it makes sense to park your cash.
Inflation has topped a near 40-year high, meaning that depending on your age, your purchasing power may be at an all-time low within your lifetime. This is important to keep in mind when your money is in the bank earning little-to-no interest since it is then being eroded by growing inflation. It may make sense to allocate some funds you have on the side-line to investments or insurance products that can keep up with inflation.
It’s no surprise that we may continue to see different variants of COVID-19 for the foreseeable future. What will be surprising is how the market and overarching U.S. and global economic react to such news. You want to make sure that regardless of such surprises, your money is protected from large drops in the market.
The market has been generally very good since the COVID-recovery in 2020, but the market volatility is still relatively prevalent. If you are nearing retirement and don’t want to have to check the market on a daily basis, consider allocating a portion of money toward insurance products that provide consistent income to you, regardless of stock market conditions.