40 • RUBY, WILDING & SWANSBURG But it took a whil e for t hese product s t o cat ch on. Even b y the 1980s and 1990s, annuities were niche products no t widely us ed in s avi ng. There wa s a good rea son for that . In t he 1990s, work ers weren’t facing the saver’s dilemma Marty discussed in the last chapter. The market was rocking. Even a novice stock-picker was likely to see his investments go up. Balanced mutual fu nds w ere retu rning up t o 40 percent . But then something happened. One of those watershed moments that, like COVID- 19, cha nged t he wa y w e approa ch sa ving forever. That something was the dot-co m bubble burst in 2000, when the market saw three straight years of declining returns. Eight years later, those same savers confronted the 2008 financial crisis where they watched the market plummet 37 percent. Suddenly, long-game income was much harder for IRAs and 4 01(k)s to p roduce. Newly Discovered Risks In the f inancial industr y dur ing the 2000s , you began to s ee expert s talk about “point-in-time risk.” This wa s t he risk associated with whe n yo u retire . If yo u retired i n 2001 or 2008, you ha d a lot of point-in-time risk; that is, you were pulling retirement income fro m assets that had lost a lot of their value because of market crashes. In thes e years , many Americans were burning through their savings a lo t quicker th an they planned . Many we nt bac k to work or deferred retirement until their accounts regained the market losses.
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