ARKANSANS WHO ARE FIVE OR MORE YEARS away from retirement should not despair despite the worst investment returns in years, financial planners say.

For those closer to retirement, however, the economic downturn might force some tough choices.

Over the past year, many investors saving prudently and persistently for retirement have taken a hit. And many close to retirement took large hits from which they'll find it tough to recover.

From Oct. 9, 2007, to Oct. 10, 2008, the Standard & Poor's 500 Index dropped 43 percent, according to statistics compiled by Fidelity Investments. The Dow Jones Industrial Average shucked off 5,713 points from its Oct. 9, 2007, close of 14,164 - a 40 percent dive.

"If they are still five years or more out from retirement, they have plenty of time to recover from this year," said Karron Wages, the aptly named president of the Financial Decisions Institute of Little Rock. "It's really the people right on the cusp or who have retired that are in trouble. There is not a lot they can do" if they haven't planned well.

There's hope though. Fidelity's statistics showed that the year after a market hits bottom, the S&P 500 Index produced an average one-year return of 39 percent.

An investor can never expect an easy ride, several local financial planners said. To maximize return, one must be willing to take risks. "If there were no risks, we'd be earning the same we'd get out of a savings account," Wages said.

And when planning, investors should remain skeptical about receiving everything promised by company retirement plans, pensions and Social Security, advisers said.

Financial, Mental Stress

New business is not flowing into the offices of financial advisers, but several reported that their established clients are calling more frequently.

An economic downturn tests more than finances, Stephen DeSalvo, chairman of Ifrah Financial Services of Little Rock, said.

"What you have to do is get yourself ready not only financially, but mentally and emotionally, because there will be times when the market does not cooperate," said DeSalvo, who works in Ifrah's Hot Springs office.

An 81-year-old retiree living in Little Rock agreed to speak with Arkansas Business about his finances on condition of anonymity. He and his 77-year-old wife live off the interest and dividends from their savings and Social Security's fixed payments, plus another monthly check from the sale of his business.

His investments have dropped in value by 18 percent since Jan. 1, he said, though he would not disclose his net worth. He and his wife have not altered their lifestyle - yet.