Financial Tsunami Devastates Retirees

A recent publication in AARP Bulletin Today, entitled "Tough Times For Retirees," describes the stark reality that many older Americans are facing as they witness their retirement savings being swept away by the financial tsunami that has devastated Wall Street and Main Street.

Millions of retired Americans are facing the prospect of getting by without the savings cushion they thought would be there for them in their old age. We have just witnessed the worst stock market crash since the Great Depression, and many retirees were not prepared for such a catastrophic event.

One retiree that was profiled in the article said: "That in the three months between August 31 and November 30, 2008, the market downturn reduced the value of his investments by about 32 percent." He went on to say that "I'm devastated. That is all the money I have left in the whole world. I don't know what to do."

Not Just A Financial Trauma

For retirees like him the 2008 market meltdown has not just been a financial crisis but an emotional trauma as well. Older adults have described feelings of embarrassment due to the possibility they will not have enough money to make it in retirement. Some report that they will be forced to rely on their children for support, something they want to avoid because they hate the thought of burdening their families.

The stock market decline has not only harmed retirees, but millions of boomers that were on the verge of retirement. Many workers have decided not to retire as planned. An AARP survey of workers age 50 and over showed that 59 percent said they were likely to postpone retirement.

The number of dollars lost in the market decline has been mind-boggling. According to The Investment Company Institute, as of October 31, 2008, the assets of the 4,800 stock funds had declined by $2.59 Trillion. $2.39 Trillion was attributable to market-related losses. The other $195 Billion decline represented the amount that investors pulled out of the funds.


A Reverse Mortgage Could Help

If you find your situation to be similar to those outlined in the AARP Bulletin Today article, you may wish to consider tapping into home equity through the use of a reverse mortgage. A reverse mortgage can supplement your retirement income, allow you to remain living in your home as the owner, and never make a payment on the reverse mortgage loan as long as you live in the home.

Request a reverse mortgage loan quote today!