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Portfolio > Economy & Markets

Self-Directed Investors Staying in the Market, Cutting Expenses: Survey

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Eighty-six percent of self-directed investors in a new survey said they are concerned or very concerned about inflation, and 79% are similarly worried about the stock market, Janus Henderson Investors reported this week.

Yet the survey found that just 13% of investors have moved money out of stocks or bonds and into cash. Instead, they have tightened their budgets.

Forty-nine percent of respondents said they have reduced their spending or plan to reduce spending as a result of the financial markets and rising inflation.

Moreover, 45% of investors said they feel less confident about their prospects for living comfortably throughout retirement. Nine percent have hired a financial advisor this year, or plan to do so, but less than 2% said they plan to change advisors because of the market downturn.

“With both stocks and bonds posting three consecutive quarters of negative returns in 2022, investor confidence has suffered, but it hasn’t collapsed,” Matt Sommer, head of Janus Henderson Investors’ defined contribution and wealth advisor services team, said in a statement.

“The COVID-19 stock selloff and quick comeback that occurred in 2020 put a spotlight on the challenges of timing the markets and remains a vivid example of the importance of creating and sticking to a plan in all types of markets.”

Janus Henderson Investors distributed the survey to a randomly selected group of investors within the firm’s direct business channel, which caters to self-directed investors. More than 1,900 investors — all ages 50 and older and the sole or shared financial decision-maker for their households — completed the survey in October.

Waiting for Rebound

Another reason investors haven’t gone to cash might be that they expect better days ahead. Sixty percent of survey participants said they believe that the S&P 500 index will be higher a year from now, while 26% expect it to be lower and 14% think it will be relatively unchanged.

As for generating income in retirement in the current environment, 65% of respondents said they prefer dividend-paying stocks, 24% prefer annuities, 23% taxable bonds and another 23% tax-free bonds.


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