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Some Thoughts After Opening My IRA Statement

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This weekend I had the pleasure of receiving my end-of-the-year statement from the institution managing my IRA. I made the mistake of opening it. Obviously, I am aware the markets did not do so well in 2008. Seeing the personal damage, however, made the whole matter that much more painful.

In the last six months, my IRA shed almost three years worth of my family’s savings. This was not money I had sitting idle. My wife and I skimped on other areas so we could be responsible adults and save for our retirement. Too bad the people entrusted with our money weren’t nearly as responsible.

I know my portfolio benefitted from the good times. But whatever gains I received in the past do not balance out the substantial losses of the last year. I can’t help but wish I had that money back, to spend on my mortgage or my kids’ preschool or, hell, a trip to Hawaii. A market recovery will help return some of that money, but, really, I would have been better off delaying my savings or placing the money in a mattress. I’m sure, mathematically, that’s not quite accurate, but I expect the crash of ’08 to resonate with my generation for a long time to come.

But my generation is actually lucky, all things considered. We have 30+ years for our savings to rebound. I can’t imagine what’s going through the minds of people on the cusp of retirement. I’m surprised there’s not more anger. Maybe that’s because many are still in shock at the extent of the collapse. Or maybe American’s are wonderfully hopeful people willing to believe hard times are just precursors to great times.

I too believe in America’s ability to rebound. But I don’t think we’ll come out of this unchanged. For better or worse, we’re a slightly, maybe even a substantially, different nation now.