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Welcome back to "Ask an Advisor," the advice column in which financial pros answer pressing investment questions. The topics can range from retirement to taxes to wealth management — or even advice on advising — and the questions are from real people.
Today's question comes from a father in New York City who's afraid the bear market will erode his retirement savings — and he's not just worried for himself. Like many American parents, he has a child with autism who will need lifelong care. Building a solid nest egg is not only crucial for the father's future, but for his son's.
In the United States, about 2.3% of all children have been diagnosed with autism, according to the Centers for Disease Control and Prevention . More broadly, about 17% of children aged 3 to 17 have some form of developmental disability. Many of these children will need healthcare and other services long after their parents are gone, which can add urgency — and emotion — to their financial decisions.
In the case of this concerned dad in New York, he's considering extreme measures to protect his savings. Here's what he wrote:
I'm a 59-year-old insurance underwriter in Queens, New York. My biggest financial concern is securing a future for my son, who is 22 and has severe autism. My retirement savings are an important part of my plan, but I worry this year's volatility is putting them in jeopardy.
I am extremely concerned about the current market downturn. I plan to retire at 67, and I've saved up $1.1 million in my 401(k). But with stocks falling and a recession possibly on its way, I'm wondering if I should withdraw it all now and invest it in something safer. I have a few ideas: I could buy bonds — particularly I bonds, to outpace inflation; I could put all the cash in a series of high-interest CDs; or I could even deposit it all in a regular savings account and hope my money lasts longer in there than in the stock market. I know these may sound like drastic options, but I worry seven or eight years may not be enough time for the markets to turn around. Or should I just leave everything in the 401(k) and ride it out?
— Questioning in Queens
Here's what advisors wrote back: