Americans Plan to Change Investment Strategies

Some respondents plan to increase stock investments and cash reserves in the next year, according to a survey by Allianz.

More than half (54%) of respondents said they plan to keep a greater amount of cash reserves in their banking accounts over the next 12 months, according to The Allianz Consumer Confidence Survey. Fifteen percent of survey respondents said they plan to invest more strongly in life insurance/annuities, and 17% plan to increase their investments in stocks.

When asked about their personal financial situation, almost half (46%) of respondents said they are very confident, according to a release of the results. However, almost the same percentage (43%) indicated they are very concerned about their financial situation. Respondents showed even more concern about their retirement savings situation (58%). In addition, 52% of those surveyed said they are very concerned about becoming ill or needing long-term care.

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National Economic Outlook

The Allianz Consumer Confidence Survey found Americans are more optimistic about their personal financial future than they are about the economic direction of the country. Specifically, 73% of the respondents said they feel either rather bad or very bad about the overall situation in the U.S. in the next 12 months, 19% feel neither good nor bad about it, and only 17% feel either very good or rather good, according to Allianz.

Just 11% and 15% of respondents of the East North Central and West North Central regions, said they feel either very confident or rather confident, respectively, about the overall situation in the U.S. in the next 12 months. Twenty-two percent of the respondents from the Pacific region indicated the same.

When asked about the general economic situation, 83% of respondents said they are either very concerned or rather concerned. Eighty percent feel the same way about international financial markets, and 79% feel similarly about the security of jobs.

The study, conducted in October and November, was based on telephone interviews with 1,000 U.S. respondents aged 18 and older.

More Companies Go Match-less

A Las Vegas casino company and one of Utah’s largest employers are the latest to cut 401(k) employer match contributions in an effort to reduce costs.

Station Casinos announced last week it is suspending its 401(k) matching contributions, according to the Las Vegas Review-Journal. The casino company said the cut was forced by the struggling economy.

Station Casinos’ executives are taking pay cuts and will not be getting bonuses this year, according to the news report. No other local gaming company indicated that it is changing its 401(k) policies.

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In addition, MGM Mirage terminated its supplemental executive retirement plan in November and has stopped matching funds for its employees’ deferred compensation program, but spokesman Alan Feldman said the company has not discussed changing its 401(k) plan.

Meanwhile, one of Utah’s largest employers, Intermountain Healthcare, has told its 28,000 employees it will not contribute its share to their 401(k) retirement funds next year. According to the Salt Lake Tribune, the company told employees about the cutback in its contributions in an e-mail newsletter last week, citing “the difficult economic times we’re facing.”

Spokesman Daron Cowley told the Tribune Intermountain’s decision on 401(k) contributions is only for 2009, and no decisions have been made beyond that. The organization will continue contributions to the company’s fixed pension plan and employees will get raises.

The U.S. recession continues to affect retirement investments, as companies such as General Motors, newspaper publisher Lee Enterprises, and rental car company Dollar Thrifty Automobile Group previously announced they have suspended their contributions to 401(k) plans (see Tightening Economy Squeezes 401(k) Match Suspensions).

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