LOW INTEREST RATES HURT RETIREES
With money market interest rates and CD rates being so low, the ones that are really getting hurt are people who are retired or will soon retire. The older you get, the more coservative you should get in your investments. This is because you may need the money sooner than later and you want to make sure it is intact.
Most retirees should have had most of their money out of the stock market and out of mutual funds. If they had then they would not have been hurt too badly by the stock market’s sharp decline in the last year. That decline is precicely why older people should have very little of their money in stocks. Now that they have lost so much, they may not live long enough for them to see it rebound. And if they need it for healthcare or to move into a retirement community, they no longer have it.
Seniors should have most of their money in bank CD’s, goverment bonds, or some other very safe guaranteed vehicle earning interest. If they need more than social security to get by, and with inflation many seniors do, they will be dependent on the extra interest income their money generates in these safe investments. Interest income is what many seniors live and depend on.
With government bonds paying 0% right now and bank CD’s and money market accounts paying not much more, retirees are in every bit of a tough a situation as the rest of us. It used to be that if you had money you could earn money. As the saying goes, ‘put your money to work for you”. Right now with interest rates close to 0%, it is impossible to get by on interest income. The media ignores senior citizens as they usually do and retirees don’t have much of a voice. The only time polititions are interested in seniors is when they want to scare them into voting a certain way. It’s too bad that no one ever looks out for them. Afterall, if we are lucky we too are all going to be seniors one day.
