Why the Financial Crisis of 2008 is Still Hindering Retirement
Updated on Sep 14 2018
Even though ten years have passed since the Great Recession, the effects are still very real for many Americans. The 2008 market crash has made it difficult for many to retire.
The Great Recession is nearly a decade in the rear-view mirror, yet many Americans say they still feel its effects. One-in-3 people say they have yet to, or never will, recover financially from the 2007 recession, according to a new report from Country Financial.
Along with the recession, the Information and Digital Age has boomed, changing workplace demands and jobs. For many older Americans, these realities have impacted not only financial and job-security, but also the ability to save for retirement.
Which Demographics Have Taken the ‘Hardest Hit’ Financially?
The demographics who have taken the hardest hit, according to the research, are Women, African-Americans and low-income people:
- 25 percent of women
- 26 percent of African-Americans
- 37 percent of those earning less than $30,000 per year
In fact, according to those surveyed, they noted “they would not be able to pay their bills within one month of being unemployed.”
The survey was conducted by EMC Research for Country Financial, a group of U.S. insurance and financial services companies with customers in 19 states. EMC Research polled 1,000 U.S. adults online in June.
Main Reasons Americans Are Still Facing Financial Turmoil from Recession
While some Americans have had a difficult time recovering from the market crash, they also have suffered on the job-gront. Many are having a slow-recovery because they are suffering from a “job-skills gap,” notes Doyle Williams, Chief Marketing officer for Country Financial:
“The challenge is that people are either locked into areas where there’s no job opportunity … or don’t have job skills. Having already been hit financially, they’re just not able to recover.”
One-third of Americans in the survey said the job market is the top concern affecting their financial security. Upheaval in the housing market — which contributed to the recession — ranked a distant second, with 20 percent citing it as an issue in their financial well-being today.
Ten years ago, the housing crisis was the most important thing. While that crisis has passed, the residual is overall financial stability in the marketplace and in individual Americans’ retirement portfolios.
Williams notes, “For most people, home values have risen, so that’s no longer the most important issue. Now it’s about how to improve the personal finance situation — with jobs.”
Whether it’s getting the education to jump-start your career or starting a second job to increase your income, there are tangible ways to take control of your income.
How to Recover From the Financial Crisis So You Can Retire
Recovering from financial turmoil caused a decade ago requires strategizing on the individual level. First, the people affected need to review their finances in detail and develop a portfolio management strategy that works for their individual situation. Getting spending under control in America’s consumerist culture is also important. If finding a relevant job is the problem, it’s important to either be creative or look for training or educational opportunities to improve your earnings.
According to Dan Schawbel, Research Director at Future Workplace, a human resources advisory and research firm providing insights on the future of learning and working, there are millions of available jobs but no workers with the right skill-sets to fill them. He notes:
“Companies need to do a better job of examining the skills they need and then incorporating the right training to get their employees up to speed. By up-skilling your employees, they are able to shift into more in-demand, critical positions in your company, which allows you to compete at a higher level.”
Financial security and a stable retirement that lasts for thirty years or more requires diligent planning and financial attentiveness. Experts say it’s also about making the most of what you have in the following ways:
- Building savings accounts
- Paying-down debt
- Reducing dependency on credit
Americans who haven’t recovered fully from the recession most likely have debt or are not saving. It’s a vicious cycle of paying excessive money on interest and not having enough to save for your future.
In the 21st century, financial security and recovery is in each individual American’s hands as the days of pensions and built-in financial workplace security are becoming extinct.
“In light of all the world’s uncertainty, this self-reliance that Americans still feel, like ‘individually I have the most control over what happens to me,’ that was a very optimistic and uplifting note that came out of the survey,” said Williams.
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