Source: Wallet Hub
2013 was a year characterized by economic distractions, with things like the government shutdown, concerns about a potential U.S. default, and overall political obstinacy taking center stage. So, it’s fair to wonder: Will 2014 be any different?
While it’s impossible to know for sure, we can certainly offer some educated predictions for what the New Year has in store for consumers’ wallets. From GDP growth and unemployment to the stock market and gas prices, you can get a sneak peak of the most important issues facing your money in 2014 by checking out our predictions below.
Retirement Planning
Pamela Villarreal – National Center for Policy Analysis
“For younger baby boomers who are more than 10 years away from retirement, the outlook could be positive. The Federal Reserve reported this week that household wealth has reached an all-time high, thanks to high stock prices and increasing home values. This means that pre-retirees have recovered from the crash of 2008.
For baby boomers just a few years away from retirement, however, the boost in wealth may not be enough. Many plan on working longer than they originally planned. While this in part due to the economic climate, it is also due to the lack of saving, which is a cultural mindset.
One of the big concerns for those who are nearing retirement is interest rates. Conventional wisdom tells us that as workers get older, they should move their savings away from equities and into ‘safe’ investments such as bonds. However, this is hardly feasible with interest rates at an all-time low.
With such low returns and the fact that more and more people will live to be 100, you will likely see a move away from this traditional view of investing and more individuals will keep money or allocate more money into higher-return investments. Stocks will be viewed as a necessary part of investments even as people retire. After all, if an individual retires at 65 and lives to be 100, that is 35 years of potential investment opportunity.”