Americans Are Cutting Back on Retirement Plan Contributions During COVID-19. Should You Do the Same?
The COVID-19 crisis has had an ugly economic impact since cases first started exploding in March. In the weeks since, millions of Americans have lost their jobs, while others have seen their income take a hit as businesses buckle down and look to lower expenses. And let's not forget retirement plans -- Fidelity reports that the average 401(k) is down $20,900 compared to the close of 2019, while the average IRA is down $16,500.
But it's not just that retirement plan values have dropped during the pandemic; it's that workers are also rethinking their plans to keep funding them. An estimated 55% of Americans plan to make change to their retirement contributions, reported Mass Mutual in April, and of those, 54% intend to contribute less. Given the number of people who are struggling financially, that's not surprising. But should you cut back on funding your IRA or 401(k) as the COVID-19 crisis plays out? Or should you stay the course despite the economic uncertainly that abounds?
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Source Fool.com
