Retirees Worry More Than Working Investors


 Perhaps they worry because they don’t have anything else to do. But retirees express greater concern than working investors over the nation’s political climate and the condition of the stock market.

Spectrem’s monthly Affluent Investor Confidence Index includes a topic of the day question asked of investors with $500,000 or more of investable assets. For September, the question was “What is the most serious threat to achieving your household’s financial goals at this time?”.

Twenty-five percent of retired investors said the political climate in the United States is the great threat to their financial goals. That’s much higher than the 16 percent of working investors who feel that way.

Another category in which retired investors are more concerned is market conditions, which remain remarkably high as they have since before the Trump Presidency and after the election. Seventeen percent of retired investors feel market conditions are a source of worry compared to just 12 percent of working investors.

Investors were only allowed to pick one concern, which may be why only 8 percent of retired investors selected “International Situation” and 5 percent of working investors did likewise. Nine percent of working investors selected “The Economy’’ as did 8 percent of retired investors.

Spectrem’s Affluent Investor Index is a monthly survey designed to determine how investors currently feel about the state of the economy and the state of their portfolio. When the index is segmented by retirement status, a major dichotomy of opinion appears.

The best indicator is the index number itself, which runs above and below 0 marking a positive or negative attitude toward the state of financial affairs in America. The index number for working investors in September was 14, down from August by just one point, while the Affluent Index for retirees was 10, a huge jump from the August number of -2. In September, retirees indicated a renewed optimism about the economy and its effects on their income and savings.

Retired investors reported a significant increase in stock investing, with 31.5 percent so involved, while working investors dropped their interest in stocks to 24.6 percent. There was also an increase in Mutual Fund investing among retirees, up to 41.7 percent from 29 percent one month earlier.

A key indicator of optimism in the Spectrem Affluent Investor Index is those investors indicating they have no intention of investing more in the coming month. Among retirees, the percentage went down to 38.9 percent from almost half, 48.4 percent, the month before. Among working investors, 32.5 percent were not going to extend their investments in the next month.

The Spectrem Household Outlook, which asks investors to rank four financial components in their lives, in September pointed yet again to renewed optimism among retirees. Asked to rate the Economy either better, the same or worse, retirees were overwhelmingly in favor of better, at 17.59, topping the judgement of working investors, who put the Economy at 15.08.

Retirement funds and investment outlook is usually not as volatile as the finances of working investors. There are fewer moving parts. But the results from the September Index and Outlook indicate that retirees are seeing a positive view of the present and the future.


©2017 Spectrem Group