# Trump is right — many 401(k) plans are benefiting from a recovering stock market — but that isn’t the whole story

The stock market is recovering from extreme volatility in March, when much of the country was shut down in response to the coronavirus crisis. The market was always expected to recover, though it did so sooner than some experts anticipated. That rise typically benefits 401(k) plans and other retirement investment accounts, depending on what investments are held.

Does this mean Americans want to thank Trump? Yes and no, according to a September Bankrate survey. Slightly more than a quarter of respondents said their financial situations improved since Trump took office, while 40% said they’re in the same financial shape as they were before January 2017, and another quarter said their situations have gotten worse.

Not all Americans have 401(k) plans. Many employers, especially smaller businesses, do not offer these types of retirement plans to their employees because of complexity or cost. And even when they do, some workers don’t participate in them because they can’t afford to or they may not know about these benefits. Only about a third of Americans were invested in a 401(k) plan in 2017, according to U.S. Census Bureau data.

Still, Americans weren’t sure if either candidate would help their personal finances. Almost four in 10 people (39%) said a Joe Biden/Kamala Harris ticket would be better for their finances, and 35% said a Donald Trump/Mike Pence combination would do the trick. Another 15% said they weren’t sure who would be best for their money and 11% said neither. The younger the voter, the more likely they are to be undecided, the survey found. “Americans’ view of their own individual finances is much more complex than to be singularly focused on the performance of the stock market,” said Mark Hamrick, senior economic analyst at Bankrate.

With the economy recovering, people who continued to contribute to their portfolios, or stayed with their investment strategies, are in “good or better shape with the 401(k) balance versus pre-pandemic,” said Stuart Robertson, chief executive officer of ShareBuilder 401(k), which sells and manages businesses’ retirement plans. But not everyone will experience that boost. Millions of Americans lost their jobs, which would affect if and how they contribute to a retirement plan, and others saw a reduction in wages, potentially halting any contributions they could afford.

“Many businesses and jobs have been impacted, so some have lost the ability to contribute to their 401(k) due to job loss,” he said.

The crisis won’t deter every American from retiring — even with so much volatility this spring, retirement savers showed they were disciplined with their investment strategies, according to Fidelity Investments data.

The success of the stock market doesn’t affect 401(k) plans equally. Some portfolios may be heavily invested in assets tied to the market’s performance, such as an index fund that tracks the overall market, Hamrick said. There are so many underlying variables that impact a balance’s rise or decline, including which asset classes they’re invested in, the percentage of their portfolio is invested in those assets and interest rates.

When a person chooses to retire also affects how crucial the volatility is to an individual’s current financial situation. Someone retiring in three or four decades will see years of market ups and downs before they need the money in their portfolios, while someone retiring in the next few years would be more sensitive to major market movement.

Still, the stock market recovery and rising 401(k) balances as a result, are common talking points of the president’s. During the summer, Trump said with a different president, 401(k) plans would “drop down to nothing.”