DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.

The stock market can climb even while workers drain retirement accounts to cover immediate expenses. Sen. Ted Cruz highlighted that troubling divide after Republicans lost both the House and Senate in the midterm elections.

During an episode of his podcast titled “Bloodbath,” the Texas Republican called the result a “Watergate-level repudiation.” He blamed his party for failing to recognize the financial pressure weighing on Americans.

“Food is too high, gas is too high, diesel is too high, insurance is too high, life is too high,” Cruz said. He then criticized two major policies associated with President Donald Trump.

“Tariffs have made everything too expensive, and the Iran war has dragged on too long.” Cruz also pointed to hardship withdrawals from retirement plans as evidence of the strain facing households.

“In 2025, 6% of 401(k) holders took hardship withdrawals, paying penalties. That is a record, and triple the norm,” Cruz said. Although he did not identify his source, the figure matches Vanguard’s How America Saves 2026 report.

Vanguard found that 6% of eligible participants in plans it administers took at least one hardship withdrawal during 2025. That was up from 4.8% one year earlier and roughly triple the average of about 2% before the pandemic.

Money removed through a hardship withdrawal no longer has the opportunity to grow inside the retirement account. A withdrawal from a traditional 401(k) also generally counts as taxable income.

People younger than 59½ may owe an additional 10% tax unless they qualify for an exception. Unlike a 401(k) loan, money taken through a hardship withdrawal cannot be repaid to the plan.

Financial strain is also appearing at grocery stores and in household bills. A LendingTree survey found that 29% of buy now, pay later users had used the loans for groceries, more than double the 14% reported two years earlier.

Users have also turned to those loans for medical care, dental care and utility bills. The figures show how consumers are reaching for financing options to meet expenses that traditionally came from ordinary household income.

Researchers at the New York Fed estimated that American businesses and consumers together carried nearly 90% of the economic burden from the 2025 tariffs. The Iran war created additional pressure through sharply higher fuel costs.

AAA placed the national average price for regular gasoline at about $4.07 per gallon at the time of writing, nearly 32% above the level one year earlier. Diesel prices were up 68% over the same period.

Brown University’s Iran War Energy Cost Tracker estimated that Americans spent more than $153 billion extra on gasoline and diesel compared with what they would have spent without the war. Those costs added to the broader erosion of purchasing power.

According to the Federal Reserve Bank of Minneapolis, $100 in 2026 had the same purchasing power as $11.65 in 1970. Investors seeking protection from that erosion have historically considered assets such as gold.

Gold cannot be printed at will by central banks, and its limited supply can help it preserve value. Investors also often treat the metal as a safe haven during periods of economic turmoil or geopolitical uncertainty.

Ray Dalio, founder of Bridgewater Associates, has repeatedly emphasized gold’s role within a resilient portfolio. “People don't have, typically, an adequate amount of gold in their portfolio,” Dalio told CNBC last year. “When bad times come, gold is a very effective diversifier.”

Gold climbed about 121% over the previous five years as inflation continued reducing the dollar’s purchasing power. JPMorgan CEO Jamie Dimon has said gold could “easily” rise to $10,000 per ounce in the current environment.

Investors can hold physical gold or gold related assets through a gold IRA, which combines an IRA’s tax treatment with exposure to the metal. Existing 401(k) or IRA accounts can often be rolled into a gold IRA without tax related penalties.

Real estate is another asset investors use during inflationary periods because property values and rental income can rise alongside broader costs. The S&P Cotality Case-Shiller U.S. National Home Price NSA Index increased 84% over the previous 10 years.

High home prices and elevated mortgage rates can make direct ownership difficult, while managing tenants, maintenance and repairs demands time. Investment platforms can offer exposure to rental properties without requiring investors to purchase and operate an entire property themselves.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.