Don’t Resign From Your Job Now To Insure Against Recession!

Are you concerned about how you’ll make it through the upcoming recession? Are you worried that it will be worse than the recession of 2007-2009? Then consider worrying about the recession that will come after this one while you’re at it and the one after that because things do happen!

Millions of investors lost billions of dollars during the Bear Market in the early 2000s. The stock market fell by over 50%. This is an investor’s worst nightmare, especially if they are about to retire or are already receiving a fixed pension. To hedge against losses, many transferred their TSP and 401(k) funds into “safer” bonds or treasury securities. However, they missed the stock market’s recovery.

Many workers in the private sector also had to accept salary reductions of between 5 and 25 percent to keep their employment. Additionally, some businesses, including several well-known investment management behemoths, ceased matching their employees’ 401(k) contributions to survive.

For two years, federal employees were not given pay raises. But there were no layoffs brought on by the recession. Indeed, several agencies expanded. Investors continued to receive a matching government contribution from the TSP of up to 5%. More evidence is that having a plan that includes Congress members is nice. Additionally, employees with sufficient service time continued to get WIGs (within-grade raises) worth around 3% to everyone, two or three years, based on their length of service with the government.

Financial expert Tammy Flanagan advises not to concentrate solely on the upcoming recession, whether it’s two years or two weeks away. What about the upcoming recession? Always be ready because things happen, whether it’s a war, recession, or your house’s roof collapsing.

Tammy advises those eligible for retirement or about to retire should consider waiting. Possibly a two-year wait. She noted in a previous column that an individual making $80,000 per year who works two more years, from 60 to 62, will see an increase in their starting annuity of about $30,000. This is significant because, in contrast to FERS retirees, who receive no COLA until age 62, CSRS retirees always receive the full cost of living adjustments.

If inflation rises above 3 percent, it becomes negative 1 percent. Unfortunately, it is currently running at a considerably higher rate. So are you prepared for retirement now, after the downturn, or both? According to the Employee Benefit Research Institute, many public and private retirees are not well prepared for retirement. The research found the following, among other things:

• A lot of retirees lament their lack of savings. But, even if it seems obvious, it might already be too late by the time you’ve learned that lesson.

• In addition, most retirees appear to fare better if they have a financial advisor.

• According to the EBRI, nine out of ten retirees who use financial advisors believe the benefits they received “outweighed the cost” of hiring one.

Another survey from the Nationwide Retirement Institute found that a cross-generational surge of Americans is canceling or delaying significant events due to increased costs.

Nationwide revealed that most consumers worry about inflation and anticipate a continuous increase in the cost of living over the coming year. In addition,13% of Gen Xers and baby boomers said they have delayed or thought about delaying plans to quit employment because of rising prices.

According to Zachary Bachner, a certified financial planner, people nearing retirement or already on fixed incomes may be particularly susceptible to inflation.

When prices rise, he explained, people are frequently compelled to review their spending plans and look for areas where they may cut back.

Additionally, the “sequence of returns” risk associated with stock market downturns might cause additional issues for some retirees depending on how their portfolio is set up and when withdrawals are made.

Bachner explained that if retirees are selling less expensive assets to pay for rising expenses, the recent dips in bond and stock prices may put them in danger.

Even while most investors think rising expenses would damage retirement funds, some advisors claim that just increasing prices haven’t caused their customers’ plans to cease working to change.

While inflation and the imminent recession may not be the only reason to delay retirement, it’s a great option to look at, especially if you don’t have much saved up for retirement.

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Bio:
After entering the financial services industry in 1994, it was a desire to guide people towards their financial independence that drove Aaron to start Steele Capital Management in 2013. Armed with an extensive background in financial planning and commercial banking coupled with a sincere passion for helping people, Aaron has the expertise and affinity for serving the unique needs of those in transition. Clients benefit from his objective financial solutions and education aligned solely withhelping them pursue the most comfortable financial life possible.Born in Olympia, Washington, Aaron spent much of his childhood in Denver, Colorado. An area outside of Phoenix, Arizona, known as the East Valley, occupies a special place in Aaron’s heart. It is where he graduated from Arizona State University with a Bachelor of Science degree in Business Administration, started a family, and advanced his professional career.Having now returned to his hometown of Olympia, and with the days of coaching his sons football and baseball teams behind him, he now has time to pursue his civic passions. Aaron is proud to serve on the Board of Regents Leadership for Thurston County as the Secretary and Treasurer for the Morningside area. His past affiliations include the West Olympia Rotary and has served on various committees for organizations throughout his community.Aaron and his beautiful wife, Holly, a Registered Nurse, consider their greatest accomplishment having raised Thomas and Tate, their two intelligent and motivated sons. Their oldest son Tate is following in his father’s entrepreneurial footsteps and currently attends the Carson College of Business at Washington State University. Their beloved youngest son, Thomas, is a student at Olympia High School.Focused on helping veterans and their families navigate the maze of long-term care solutions, Aaron specializes in customized strategies to avoid the financial crisis that care related expenses can create. Experience has shown him that many seniors are not prepared for the economic transition that takes place as they reach an advanced age.With support from the American Academy of Benefit Planners – an organization with expertise and resources on the intricacies of government benefits – he helps clients close the gap between the cost of care and their income while protecting their assets from depletion.Aaron can help you and your family to create, preserve and protect your legacy.That’s making a difference.

Disclosure:
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