SUNBURY -- A Selinsgrove couple planning to retire in five years lost $75,000 in investments during the current recession and will have to work into their 70s.

Barry and Mary, 61 and 59, respectively, said they were too ashamed to have their surname published. But they wanted to tell their story so that others might avoid their mistakes.

They thought they had their retirement all figured out.

"Until the stock market declined in 2008, we thought we'd have enough money, along with Social Security," Barry said.

"We invested in some risky funds. We were chasing the best rates. You should never do that. I know that now. I never considered how the bank failings would affect my portfolio."

Barry said the couple "lost about $75,000, most of our retirement safety net. Luckily, both my wife and I are in good health. It's pretty depressing. I should have gotten professional help."

Instead, the avid reader of business journals decided to go it alone, investing in individual stocks and various mutual funds.

He never saw the downturn coming.

And then the bottom fell out for the couple.

"We lead a different life these days," he said.

Karen, of Trevorton, who also asked that her surname not be used, is a 63-year-old former social worker who retired five years ago.

Karen was lucky. She was working with a financial planner in Lewisburg when the stock market fell in 2008.

"My investments definitely dropped in value," she said, but wouldn't say by how much.

"I never was a big spender, so I didn't take many risks. I own my own house in Trevorton, my children are grown and they've moved out of the house. I might have to cut back on how I live, but I'm pretty conservative anyway."

Karen, like others, panicked a bit when her investments lost value.

"Thankfully, I was with a good agent. She sat down with all her clients and calmed us down. All of our fears were eased."

Karen is again invested in individual stocks, mutual funds and variable annuities.

"I feel secure," she said. "If I had been on my own, I might have lost it all."

Realizing that your retirement nest egg has dwindled away is a common symptom of the recession.

The good news is that there are ways to go about rebuilding your funds -- if you're disciplined, willing to plan and willing to save.

Starting over

There are ways to begin rebuilding that nest egg, Valley experts say.

It isn't easy.

It is possible.

For someone who is already retired and who doesn't need to take income off his investments, variable annuities can give him the growth potential that a mutual fund can offer, said Laura Renee Shrawder, chief executive officer of Wealth Advisor, in Sunbury.

"But it can also offer you a living benefit," Shrawder said. "A guaranteed amount that you can receive down the road."

If you need income, there are annuities that guarantee the investor a withdrawal benefit, where he can take 4, 5 or even 6 percent out for the rest of his life.

For younger clients, Shrawder calls this the best opportunity she has ever seen in her lifetime to buy stocks. Where could you purchase stock in Ford at $2 a share? she said. Younger clients are willing to assume more risk.

"But in this environment I suggest going into management portfolios rather than unmanaged portfolios, because there is a lot of volatility out there," she said.

Stock market activity on Thursday and Friday punctuated her point.

On Thursday, Dow Jones industrials average rose about 200 points. On Friday, stocks tumbled as investor jitters returned.

The Dow posted its sharpest drop since April 20, falling 249.85 points, or 2.5 percent, to 9,712.73 points.

Some retirees in bad shape

Considering all the risks, David Jensen, a Bucknell University associate professor of management accounting and professional management, is very wary about retirees being able to rebuild their nest egg.

"Those who have lost much of their wealth during the downturn are in bad shape," he said.

If someone in this situation wants to rebuild his nest egg, he must understand he has very limited options in terms of getting back all the money he lost, Jensen said.

Many retirees are selling their homes and downsizing, pocketing the difference in cash, Jensen said.

"There is no quick way of making this up," he said. "We lost a full year of investing over the last 10 years. If you bought a mutual fund in 1999 and kept it until 2009, you are probably back to where you started."

Jensen's formula for rebuilding the nest egg: "Simply spend less, save more. That's my best advice. Get a spread sheet and track your expenses. It's really very easy to do. Then save. And don't chase returns. If you are ready to invest again, understand your ability to absorb risk."

For those not retired, Jensen again advises them to plan, assess expenses and reduce costs.

"It will be hard to recoup what was lost," he said. "The market is volatile. Find an expert. Craft a plan for your future."

Young investors should start saving today, Jensen said.

"Save as much as you possibly can," he said. "The future is risky."

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