Political Climate and Retirement Having a Bigger Impact on Investment Plans

As the clock ticks down to the Aug. 2 deadline, the increasingly contentious debate over raising the debt ceiling is surely coloring Affluent investors’ concerns about their investment portfolios.

Considering the hit that those who own U.S. stocks and bonds are likely to take should an agreement not be reached and the country defaults on its debt, it is not surprising that nearly a quarter of investors say that Stock Market Conditions are the primary factor that most affects their current investment plans.

And with the most dire predictions over what will happen should President Obama and Congress not reach a budget plan compromise (also subject to debate), it is also not surprising that 21 percent of investors say the Economic Environment is the factor that most impacts their investment plans.

The Political Climate, reaching a boiling point, is considered by 13 percent of investors to be the key factor affecting their investment plans. This is up from 1 percent since April, when this question was last asked. Likewise, speculations how a default would devastate 401(k) plans and pensions as well as concerns about the solvency of entitlement programs such as Social Security  and Medicare no doubt accounts for the increase in investors---12 percent from 7 percent last April--that cite Retirement as the factor most impacting their retirement plans.

Over the past three months there has also been an increase—8 percent up from two percent-- in investors who cite Household Income cash flow as the factor that most impacts their investment activity.

Of the overall Affluent investors surveyed, Stock Market Conditions were of slightly more import to Millionaire investors (25 percent), as was Household Income (9 percent). But Affluent investors overall were more apt to cite the Economic Environment, Political Climate and Retirement as the factors most impacting their investment plans.

The still-depressed Housing and Real Estate markets continue to have a negligible impact on investors’ investment plans.