Retirement worries rise with volatility in 2022, F&G survey shows

More and more American investors feel as if their financial safety nets have been snatched from beneath them.

More than two-thirds of American investors (67%) are worried about the state of their retirement plans as a result of the market volatility in 2022, up from 47% the prior year, according to the third annual Risk Tolerance Tracker from annuity and insurance provider F&G. The survey asked American investors how the events of 2022 have impacted their views on their retirement and risk.

F&G also found an increase in financial risk aversion among American investors, rising to 78% this year from 69% in 2021, as a result of this year’s market turbulence and inflation.

“When we started the Risk Tolerance Tracker in 2020 during the height of the pandemic, respondents understandably indicated they were much more risk averse than before,” Chris Blunt, president and CEO of F&G, said in a statement. “While that slightly improved last year as things returned to normal, our latest survey found that the events of 2022 have pushed American investors to be even more risk averse than they were in the middle of the pandemic, with many people saying they feel their retirement safety net has faded away. Things have changed dramatically in just one year.”

"It's normal to feel that way during a bear market," said Alex Goss, co-CEO and co-founder of NewEdge Advisors. "Candidly, I'm surprised it's not higher. Investors should be reminded to never focus on year-to-date returns - in good markets or bad. Look at your five-year returns and remember your time horizon. A good financial adviser should have you adequately allocated with sufficient liquidity options even in bad markets. Go enjoy the holidays and let the stress of the markets be your adviser's responsibility."

Elsewhere in the study, retirement income concerns among American investors saw a 12 percentage point increase, up to 73% from 61% in 2021. Seventy-nine percent of respondents said they were worried about inflation affecting their retirement, a sentiment that has increased since 2021, when 73% of respondents said the same. 

Finally, the survey showed that nearly half (48%) of American investors say they are adjusting their retirement plan during this period of heightened inflation and 45% say they are willing to explore new financial products. That said, a majority (59%) are still not speaking to a financial adviser who can help them navigate new products, according to the report.

“During these uncertain times, investors should remember not to panic and that there are a variety of options available to navigate this challenging environment. Working with a financial advisor can help investors prioritize their financial goals and implement a long-term plan to accomplish them,” F&G’s Blunt said in the statement.

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