It seems like the perfect time to panic. Imminent spending cuts, tax hikes, uncertainty and a fiscal cliff looming. So how can you save your retirement nest egg from falling off the cliff?
"Remain calm," said Salvatore Durso, the President and CEO of the Centennial Group.
Durso has been investing his entire career. He says the markets are generally motivated by emotion, so stay calm and remain focused. While things might look bad, he says the markets always bounce back.
"So the key is not to panic. Be patient. Seek advice, and work with someone that can guide your conscious, your focus of your goals, and most importantly keep your emotions in check," said Durso. "We've had the challenges of 9-11, the dot-com bust prior to that. We had what happened to us, which is short term memory a few short years ago in 08 and 09."
The fiscal cliff will also have a big impact on big business.
Kurt Weiss is one of 50,000 people employed by the state of Michigan. Like many large employers, he says the state will not change payroll until mid January when paychecks are adjusted to reflect any outcome congress makes.
"We really are waiting for some guidance from the IRS. Until we get that guidance from the IRS as a result of the fiscal cliff we don't know what changes to make to employee payroll," said Weiss, who works in the Department of Technology Management and Budget. "I don't think gridlock in Washington serves anyone well. I think both sides of the equation would admit to that, that this doesn't serve our citizens well. I think we need to get this behind us. The biggest threat of all of this is to our economy and to Michigan's revenue."
One thing is certain: FICA taxes, the money taken out of your paycheck for Social Security and Medicare, are increasing. They were 4.2 percent and now will be 6.2 percent.
Making the country's financial matter even worse--fiscal cliff aside--in a few weeks the United States will hit the debt sealing limit. Meaning, if Congress doesn't act, the US won't be able to pay its own bills.
Business leaders are frustrated and want Congress to do its job.
"If you're concerned about this issue, pick up the phone, get on the computer, make a call, send an email to your member of Congress to the White House and demand that they support a comprehensive and a balanced solution," said Rich Studley, the President and CEO of the Michigan Chamber Of Commerce. "The Governor and legislature leaders have been working hard to reinvent our state. It almost seems like at a time when we are really beginning to turn things around here in Lansing, and in Michigan, It feels sometimes like Congress and the President are determined to take the country into the ditch."
Click the links to contact your elected officials in Congress: