Government Bonds Downgraded – What Does That Mean to Me?

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Why is this downgrade happening now and what does it mean to us as we save for and in retirement? We want to explore that in this episode and get Don’s perspective on what happened after the last downgrade and try to determine what we can do as investors to protect ourselves moving forward.

 

On August 1, the Fitch Ratings agency downgraded the US debt from its top rating of AAA down a notch to AA+. This is the second time this has happened. Ironically, that was also in August but twelve years again 2011. At that time, the Standard and Poor’s downgraded US treasury debt from AAA to AA+.

So why is this happening now and what does it mean to us as we save for and in retirement?

We want to explore that in this episode and get Don’s perspective on what happened after the last downgrade and try to determine what we can do as investors to protect ourselves moving forward.

Here’s some of what we discuss in this episode:

  • Don will provide some background and a big picture view on what’s happening with these ratings.
  • Why does this downgrade seem like it’s getting less of a reaction?
  • Could we continue to slip even further with more downgrades in the future?
  • The stock market’s response over the next decade was still very positive after the last downgrade.
  • As an investor, what are the different lessons we can take from last time?
  • What does the downgrade of 10 banks mean for me?
  • Where do we go from here and what will Don be watching in the future?

If you have any questions about what we discussed in this episode, please reach out and we’d be happy to provide answers.

 

Resources for this episode: 

https://www.usdebtclock.org/

https://www.investopedia.com/moody-s-downgrades-credit-ratings-for-10-banks-puts-six-others-on-notice-7571278

https://budget.house.gov/resources/staff-working-papers/us-debt-credit-rating-downgraded-only-second-time-in-nations-history

https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart

 

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ABOUT YOUR HOST...

Donald W. Cash – CPA, CFP®, is an independent advisor. After graduating from Rutgers University, he began his career in 1985 as an accountant. In 1990, he entered the field of Estate Planning, concentrating on long-term care planning. Don has been advising clients in the baby boomer and retirement market for 20 years. He has helped over 1,000 families with their planning needs.

Don advocates for a holistic approach to Estate and Financial Planning and has relationships with other professionals including Attorneys, CPA’s, Mortgage Specialists, Insurance Specialists and Asset Managers.

He is married to Cathy and they have 4 children, Carly, DJ, Nick and Tori. They live in Freehold, NJ.

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WAYS TO CONTACT

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