AARP The Magazine commissioned this nationwide survey in early October 2008 to find out how investors ages 50+ had reacted to the turmoil in the financial markets of the preceding 30-day time period and how the events of those 30 days had affected their outlook about investing and retirement.
In the 30 days leading up to this October 2008 survey, major changes had occurred in the financial sector of the U.S. economy, including the federal government takeover of mortgage lenders Fannie Mae and Freddie Mac, the government’s $85 billion investment in insurer AIG, the failure of Lehman Brothers, the widely publicized financial troubles of other large financial institutions, the passage of the $700 billion government bailout package, and the steepest one-day stock market decline in years.
The survey found that most investors ages 50+ did not take drastic steps with their finances during the 30 days from early September through early October, despite the turbulence in the financial sector. The lack of action by midlife and older investors may reflect uncertainty about the best course of action during such unprecedented times. It may also mean that most investors who are inclined to make changes as a result of financial market turbulence had already made major changes prior to this 30-day period.
Survey findings include:
- Nearly all investors ages 50+ (95%) reported that they had read or heard something in the 30 days prior to the survey about the recent financial events, such as government takeovers and corporate mergers.
- Of those investors ages 50+ who were aware of at least some of the changes within this early September-early October time period, the majority did not report having made major changes in their investments during this timeframe.
- Eight in ten investors (80%) ages 50+ who owned stocks within this 30-day period reported that they lost money in stocks during the period.
- Nearly six in ten investors (59%) who are employed and have never been retired reported that they were likely to have to postpone their retirement as a result of the events of that occurred during those 30 days.
- Investors ages 50+ were most likely to select Warren Buffett as the individual most capable of fixing the economy when given the following three choices: Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson, or Berkshire Hathaway Chairman Warren Buffett.
This study was conducted for AARP by International Communications Research (ICR), an independent research company. Interviews were conducted from October 9 to October 12, 2008, among a nationally representative sample of 532 adults ages 50+ who had at least one bank account or other investment held at a financial institution within the 30 days prior to the survey. For additional information, contact the report’s author, S. Kathi Brown, at 202-434-6296. (16 pages)