10 Years Post-Financial Crisis And Americans Say It Had No Impact

Business Wire

Yet Many Don’t Trust the Stock Market, Changed their Spending Habits, and Plan to Work Longer than Anticipated

WAYNE, Pa.--(BUSINESS WIRE)-- New data released today by Hartford Funds revealed that a decade after the Great Recession, Americans are unclear how the economic event impacted their life and financial behavior.

The majority (40 percent) of respondents said that the financial crisis had no impact on their life, yet large numbers reported that they avoid the market (42 percent) and have altered their spending and savings habits (46 percent). Others (26 percent) shifted their retirement timeline and plan to work longer then they’d hoped, and 25 percent had to change jobs or take on additional jobs.

“Americans are forgetting what it felt like during those challenging times of 2008-2011,” said John Diehl, Senior Vice President of Strategic Markets at Hartford Funds. “These results signify that advisors should continue to remind clients that markets can get turbulent, so they should steer clear of emotional investments and knee-jerk reactions by maintaining a fundamentally diversified portfolio to help them achieve their long-term financial goals.”

When asked about preparation for the next recession or market downturn, almost half (43 percent) of respondents said they are taking a wait-and-see approach to the markets. Nearly 1/5 of Americans (17 percent) are confident in their investments and aren’t touching their portfolios to prepare for the next recession or market downturn, while a mere 21 percent are increasing their investments to take advantage of the upside.

“When most investors say they’re taking a wait-and-see approach, that usually means that things have been so good for so long that there is no need to review where their investments stand, other than to open statements and be happy that values are up,” said Bill McManus, Director of Strategic Markets at Hartford Funds. “We see an opportunity to educate investors who may be at a standstill about the benefits of perspective and direction from a financial advisor.”

There is a clear demographic divide across market perspectives and actions. One quarter (23 percent) of Americans are withdrawing cash from their investments to prepare for the next recession or market downturn. Results indicate that those who make more money (household income of over $75,000) are more likely to liquidate and stockpile their cash than those who make less than $75,000. Millennials are hoarding more cash than any other generation, with more than a quarter (26 percent) taking money out of the market for cash savings.

Millennials, for whom the financial crisis took place during their formative job-seeking years, also have the least amount of trust in the market today, with almost half (48 percent) avoiding the market altogether. This generation continues to prepare for the worst as nearly a quarter (24 percent) have already shifted their retirement timeline and plan to work longer than originally anticipated. Thirty-eight percent are also trying to compensate for this delay by increasing their retirement savings in traditional retirement vehicles.

“Outside of Millennials, Americans are overconfident. Index investing has been wonderful because all of the indexes have been up since March 2009, but when the market turns, investors need to be intentional about what they own and why,” Diehl added.

Additional information on navigating client discussions and the future of financial advice can be found on Hartford Funds’ website.

Methodology

The subsequent paragraph describes the methodology used for the ORC International Telephone CARAVAN® survey conducted October 12-15, 2017.

The study was conducted using two probability samples: randomly selected landline telephone numbers and randomly selected mobile (cell) telephone numbers. The combined sample consists of 1,006 adults (18 years old and older) living in the continental United States. Of the 1,006 interviews, 506 were from the landline sample and 500 from the cell phone sample. The margin of error for the sample of 1,006 is +/- 3.09% at the 95% confidence level. Smaller subgroups will have larger error margins.

About Hartford Funds

Founded in 1996, Hartford Funds is a leading asset manager, which provides mutual funds, ETFs, and 529 college savings plans. Using its human-centric investing approach, Hartford Funds creates strategies and tools designed to address the needs and wants of investors. Leveraging partnerships with leading experts, Hartford Funds delivers insight into the latest demographic trends and investor behavior.

The firm’s line-up includes more than 55 mutual funds in a variety of styles and asset classes, as well as a variety of multifactor and active ETFs. Its mutual funds (with the exception of certain fund of funds) are sub-advised by Wellington Management or Schroder Investment Management North America Inc. The strategic beta ETFs offered by Hartford Funds are designed to help address investors’ evolving needs by leveraging a unique risk-optimized approach, which identifies risks within each asset class and then deliberately and systematically re-allocates capital toward risks more likely to enhance return potential. As of September 30, 2017, Hartford Funds had approximately $95.6 billion (excluding assets used in certain annuity products) in discretionary and non-discretionary assets under management. For more information about our investment family, visit http://www.hartfordfunds.com.

All investments are subject to risk, including the possible loss of principal. There is no guarantee the funds will achieve their stated objectives.

Diversification does not ensure a profit or protect against a loss in declining market.

Investors should carefully consider a fund’s investment objectives, risks, charges and expenses. This and other important information is contained in the fund’s prospectus and summary prospectus (if available), which can be obtained by visiting hartfordfunds.com. Please read it carefully before investing.

Hartford Funds refers to Hartford Funds Management Group, Inc., and its subsidiaries, including the mutual funds’ and active ETFs’ investment manager, Hartford Funds Management Company, LLC (“HFMC”) and the mutual funds’ distributor, Hartford Funds Distributors, LLC, as well as Lattice Strategies LLC (“Lattice”), a wholly owned subsidiary of HFMC effective July 29, 2016. Lattice is the investment adviser to the strategic beta ETFs. All ETFs are distributed by ALPS Distributors, Inc., which is not affiliated with Lattice or Hartford Funds. “The Hartford” is The Hartford Financial Services Group Inc. and its subsidiaries. Hartford Funds Distributors, LLC is a subsidiary of The Hartford Financial Services Group Inc.

HIG-W

Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ. These important risks and uncertainties include those discussed in The Hartford’s Quarterly Reports on Form 10-Q, our 2016 Annual Report on Form 10-K and the other filings The Hartford makes with the Securities and Exchange Commission. We assume no obligation to update this release, which speaks as of the date issued.

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