Wednesday, October 08, 2008
Retirement accounts have lost $2 trillion during fiscal crisis
The Washington Post is reporting (on Oct. 8 2008) that Individual Retirement Accounts (IRA’s) have lost $2 trillion during this current fiscal crisis (actually, during the past fifteen months). The story is by Julie Hirschfeld Davis of the Associated Press, reprinted today in The Washington Post on the front page of today’s print version (Wednesday, Oct. 8), link here or here on the AP site.
By way of comparison, I recall being told in 2003 in a sales pitch (for a job) by Citigroup PrimeVest that the potential market of converting ordinary life insurance to term life was $40 trillion. That comparison sticks in my mind.
The Bailout will cost $1 trillion (some of which could be recouped), and the stock market loss on Sept 29 when the first Bailout failed as about $1 trillion.
Our national debt is about $10 trillion, or about $33000 per person. Imagine if that could be confiscated (accounting for minors, those with less than that amount, the poor, etc).
Generally, many people approaching retirement seemed to have had 401K’s with some portion of financial stocks often connected to the faulty mortgage market.
The loss of wealth by retirees could present issues for their adult children, as noted earlier on this page (as with Monday’s posting). Families, not always by willing choice, are returning to live under the same house again.
This morning (Oct. 8), on ABC "Good Morning America", Sherry Parrish offered advice on how adult children could help parents exposed to financial losses.