About a third (35%) of Americans are putting off making any decisions about retirement savings until after the presidential and congressional elections next month, according to Voya.
Additionally, the financial services company said, 42% of working Americans believe that the pending elections will severely affect their ability to save for retirement.
“However, both short- and long-term election effects tend to be negligible. The election news cycle and outcome can cause volatility in the financial markets, though that’s typically short-lived,” Voya said.
The company advised people to “take election news in stride.” Campaign ads can cause undue worry, Voya said, and market effects in the long term tend to be limited. Investors, therefore, should focus on a long-term retirement strategy, according to the company.
“In fact, research shows that economic factors and inflation are more apt to affect long-term investor returns than elections,” Voya said.
Election results can have an effect in terms of new policies affecting debt, savings and investments. Regulations, too, may change as a result of the election.
The financial services company noted that elections can influence investor sentiment and consumer confidence. Therefore, retirement savings could be affected by portfolio allocation, reducing contributions toward retirement, or a personal shift in attitude on taking risks.
“The outcome of an election may make you more or less optimistic about the future, depending on your political affiliation. And since retirement saving is often decades long, it’s essential you stay the course with an eye toward the long term,” Voya said.
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