Stock Market Woes: What’s Happening and How It Affects Your Retirement - 3/13/2025

The stock market has been on a wild ride lately, and this week—along with last week—has been tough. As of today, March 13, 2025, the S&P 500 is down about 8% from its high earlier this year, according to recent reports. Investors are worried about new tariffs proposed by President Trump, which could raise costs for companies and slow the economy. Just yesterday, a report showed inflation cooling a bit, giving stocks a small boost, but the overall mood is still shaky. Big tech companies like Tesla and Nvidia, which had been driving gains, are stumbling, dragging the Nasdaq down too.

This rollercoaster matters a lot if you’re planning for retirement. Many folks with 401(k)s and IRAs are seeing their account balances drop—some by as much as 20% or more, depending on what they’re invested in. Posts on X even suggest the average 401(k) has lost thousands in just days, wiping out years of gains for some. It’s scary, but it’s not the whole story yet.

How Retirement Plans Work and What This Means

Most retirement plans, like 401(k)s and IRAs, get contributions credited on a set schedule—often once a year, based on the day you started the plan. For example, if you began your 401(k) on April 1, that’s when your employer might add their match or your annual contribution gets locked in. The value of those contributions depends on the market that day. If stocks are down—like they are now—your account might not grow as much as you hoped when that credit hits. For people nearing retirement, this dip could mean less money to live on if they cash out soon. Younger savers have time to ride it out, but it’s still a wake-up call to check your investments.

The Good News?

Markets go up and down all the time. Experts say not to panic—long-term planning can weather these storms. Still, with retirement on the line, it’s smart to talk to a financial advisor and make sure your 401(k) or IRA is set up to handle rough patches like this one.