The Earthquake in Japan has had a significant negative effect on world markets with the NIKKEI losing as much as 14% yetserday. The reality is that Japan is the Worlds third largest economy and a disaster of this magnitude will have spill over effects on the Worlds stock markets from New York to South Africa.
What this means for your retirement savings depends on your funds exposure to the the various foreign markets or stocks that are closely related to Japanese businesses. If your portfolio managers are heavily invested in foreign stock markets, which is very likely, you are likely to see a short term dip in returns. It is certainly no time to panic and as with any market volatility, there are opportunities which portfolio managers will be looking for to make up any dip in returns.
Situations like these emphasize the need to diversify a retirement portfolio into the various asset classes including cash, property, stocks and bonds. Be very sure that your portfolio of retirement investments cover a good spread of the asset classes with differing risk profiles to ensure that you are protected against any single act like the Japan Earthquake which may see portfolios effected take some years to fully recover.
In uncertain times like these it is always best to get some good solid financial advice and not to act on impulse, the markets are used to these types of events and experienced financial advisors that have been through other disasters like September 11, Australia Earthquake and any number of other natural disasters, wars or civil unrest have strategies in place to deal with these events.
Get the financial advice you need, it is free and without obligation by simply contacting us. A financial advisor will assist you and advise you regarding your retirement savings. Retirement savings are incredibly important and should be given the attention that your future happiness and security demand.
