How does this “Second Great Depression” thing actually affect retirement funds?
David asked:
I know nothing about the stock market.
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I know nothing about the stock market.
I really want to know exactly “how” this second great depression affects the retirement funds. It just doesn’t make sense when I think about it.
Any help would be great 
February 28th, 2009 at 2:08 am
Because when you’re in a Great Depression the U.S.A has like NO money.
No money= No retirement funds.
March 3rd, 2009 at 1:24 pm
The stock market eroded in days what has taken people many years to save, leaving their retirement nest virtually empty or close to.
March 6th, 2009 at 11:18 am
I think you mean GREATEST Depression!!! amirite?
=D
March 7th, 2009 at 7:38 am
First it is not a depression, second if you have a retirement account most of your investments are in the stock market. Which means it will take a few years to rebuild what has been lost in the last few months. Depending where your funds are allocated will determine how much you have lost, funny thing is even with the “rescue” program in place but not yet working the market is still going down because too many people are panicking over the drop, when this is usually part of a balancing of the market that happens ever 10 years or so.
March 8th, 2009 at 5:21 am
because people worked for these retirement funds their whole life. and these funds are just barely enough to get by during the days in which they saved. so its virtually nothing now
March 10th, 2009 at 3:19 pm
Many retirement funds are reinvested in equity securities directly tied to the the health of the stock market.
Since the fall in the stock market over the course of the year, shareholder wealth has deteriorated from it’s once high peak.
With that said, we are NOT in a depression, and far from a great depression.
March 12th, 2009 at 2:30 pm
Stock pricess are falling like a rock. Retirement funds contain stocks. We’re told that history shows stocks return about 10% annually, so if you invested $100 a year ago in a stock fund like VTI (buying a little bit of hundreds of different companies), you might have expected to have something like $110 today. Or, since the market has been weak, maybe you only expected $108 or $106.
What you would actually have today, though, is only about $75.
Multiply that by about 1,000. because this is your life savings we’re talking about.
I’d rather retire with $110,000 than $75,000.
Then there are the people who have gotten laid off because their companies can’t afford to pay them anymore. Why did that happen? Because people can’t get credit to buy cars or houses or even some bling at the mall, so the company can’t sell their stuff. The the company can’t get a loan to tide them over until times are better.
That company probably isn’t matching contributions to the 401K at 95 cents on the dollar anymore, and that laid off employee probably isn’t making any contributions to his IRA. So no money for retirement.
So get used to the idea of working till you’re 80. If you’re lucky, that is.