Alex Petroski and his wife, Kathy, had long planned to retire by now. As entrepreneurs who provide parts and equipment to the military, their business has been well-fueled for years by the wars in Iraq and Afghanistan.
Plus, Alex still receives a pension from working 30 years at Honeywell before starting the business in 1999, has paid off the mortgage and has invested carefully for decades.
But Petroski won't be able to "slow down at 60" because the stock market has hit the skids, he said. His investment portfolio in 2008 has dropped "about $400 grand" -- a nearly 40 percent free-fall since the beginning of the year.
"So, now I'm looking at probably 65 before I can retire," said Petroski, 60, of West Deer. "And I'll probably be working part-time then, too."
The Petroskis are like many of the baby boomers whose nest eggs have gone bust from the stock market tailspin. Most are re-evaluating their investment portfolios and even their lifestyles.
The most commonly cited stock barometer, the Dow Jones industrial average, has plunged from an all-time high exceeding 14,000 in October 2007 to about 8,000 on some of its worst days lately.
The National Bureau of Economic Research on Monday confirmed what most people thought: The country entered a recession -- technically two straight quarters of declining output -- a year ago. Meanwhile, a CNN/Opinion Research Corp. poll showed more than four in 10 people believe the nation is mired in a serious recession.
"My 401(k) is now what I call a 201(k),'" said Roger Wise, 62, of his retirement savings plan. Wise should know better than most; he is an estate, trust and wills attorney in Sewickley.
"There's no way I could retire. I'd have to work another five years to be where I was in October 2007, when the market topped out," said the attorney. And Wise has been, well, wise with his money.
For instance, when his wife retired as a public school teacher last June, the couple rolled over her retirement savings into a traditional IRA (Individual Retirement Account) invested strictly in cash, not stocks. Most of their other investments are in mutual funds or exchange traded funds, which mirror stock indexes but trade like stocks.
"I've been in diversified funds," he said. "And they've now lost about 50 percent."
Jay Friday, 62, of Indiana Township, is in similar straits. He's been a manufacturer's rep for more than 20 years, selling plastic injection molded parts and sub-assemblies to companies in the medical industry.
Friday's wife JoAnn, 61, a teacher for about 25 years, currently is teaching first graders in the Hampton Township School District. But she's staying on the job, too.
"We were both hoping to retire when I hit 65, and my wife was planning on retiring this year," said Jay. Those plans are now postponed about five years, they figure. The Fridays' nest egg has lost about 40 percent on paper, compared to a year ago.
Even their local fire department is feeling the heat. Station 172 in Dorseyville, where Friday is a trustee, has postponed a renovation and expansion of the firehouse because contributions have fallen off from market-rocked donors, he said.
Paul McCauley, 65, loves his job as a professor of forensic criminology at Indiana University of Pennsylvania in Indiana, Pa. He first figured on retiring last June.
"Then, I was pretty sure I'd retire in June 2009," said McCauley, of White Township, Indiana County.
Now, he's glad he never submitted his retirement letter to IUP, where he earns about $100,000 a year. With his retirement portfolio down about 40 percent year-to-date, McCauley doubts he and his wife could retire comfortably just relying on some private consulting on the side.
"The wisdom is, if you have a job, keep it," he said.
Other circumstances factor into what boomers should do in this tough economy, said Matthew Yanni, principal of Yanni & Associates Investment Advisors, Franklin Park. Namely:
• How close are you from retirement?
• How will your expenses and spending habits change in retirement?
• What is your comfort level with respect to investment risks?
"We think the market will remain volatile through early next year," Yanni said.
"Hold a certain amount of your portfolio in cash," said John Prescott, a business administration professor at the University of Pittsburgh Joseph M. Katz Graduate School of Business. "If people did that, they would not hurt as much."
Homebuilder Joe Costa, 66, of McCandless, shifted about three months ago from about 45 percent in liquid assets to about 70 percent. The stock market "confuses me to death," said Costa, who just hopes his 30 percent left in stocks will let him "earn a little money" when he retires soon.
The Petroskis, meantime, are putting all their business profits into cash. They are tightening their belts, especially as they worry about high health insurance costs.
"With five years to go before retirement, even if the stock market comes back, one more downturn would be devastating for people our age," Alex Petroski said.
"And we're being cautious about our spending," he said. "We'll still do Christmas, but we'll cut back in terms of spending."
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