January 22, 2008
Uncertainty on Wall Street could be heard around the world, including right here in Charlottesville.
After working for over thirty years and raising three children, Rita Balbus moved to the area from Philadelphia to enjoy her golden years.
“When I came here I had this marvelous plan of doing a trip a month,” Balbus said, a retiree.
But those plans have changed. In 2001 a drop in the stock market opened her eyes to the ugly reality she could face. Her future finances were far from plentiful, “and that really panicked me and depressed me for quite a while,” she said.
Her nerves rested following a few good years on Wall Street, but Tuesday she woke-up to find she's lost about ten percent of her investments.
“If I had a few million dollars and took ten percent I would survive nicely, but unfortunately I’m not in that range,” Balbus said.
Putting off the luxuries she's looked forward to isn't what bothers Balbus the most. It's simply being prepared for what life throws her way.
“If anything serious would happen to me where I would need care I would need that money.”
While many Americans can look forward to the day they see their money come back around, Balbus worries it will be too late.
“With in 8 or 10 years everything will be just fine we'll that doesn't register with me, because in 8 or 10 years from now that won't affect me I don't believe,” she said.
Some experts suggest the older you get after retirement, the more money you should take out to ensure you lower your risk of loosing money.
There are some simple things you can do to protect yourself and your money.
First, don't panic just because today was an unusually bad day on Wall Street. Cashing stocks in isn't financially smart.
Second, if you choose to go ahead and invest do so in a product people use every single day.
Third, focus on your greatest asset.
“The primary asset most people hold is in their home and so right now might not be the best time to sell a home if you're going to and if you are you're going to have to realize that the sale period in which you're going to engage in might be very different than what it's been over the last five years,” said Gregory Fairchild, UVa Professor of Business Administration.
The last piece of advice, now is the time to decipher between your wants and needs.