Regardless of who wins the presidential election, the retirement industry will face four big themes that will affect planning and coverage, business professor Jeffrey Brown said Monday.
The industry can expect "continued financial market volatility," said Mr. Brown, dean and professor of business at the Gies College of Business at the University of Illinois in Champaign, Ill. "Investors don't like uncertainty."
The degree of volatility will depend on whether there's a "clear answer" within a day or two or a contested presidential election that isn't resolved for several weeks, said Mr. Brown, keynote speaker for Pensions & Investments DCW Fall Series, a five-day virtual event.
Another big theme is low interest rates, which will "make retirement more expensive," he said, by pushing up the cost of annuities while also harming retirees, who typically invest in fixed-income assets. Another prominent theme is Social Security which, as it stands now, is "financially unsustainable," Mr. Brown said. He cited a Congressional Budget Office forecast that showed the Social Security Trust Funds could be exhausted by about 2031, at the current rate of spending. "We have seen this coming for a long time," he said.