Wall Street blues

Sherry Rivera was raising two children by herself on $20,000 a year, relying on savings to make monthly mortgage payments of $1,875.

Somehow, she managed to keep her head above water long enough to see her new lending business through its rocky first couple of years, despite what she recalls as an “ever-present fear of being the bag lady.”

Guardian National Funding eventually started making regular loans — enough not only to pay the bills, but also to put her son and daughter through college. She was able to save up a considerable nest egg, too.

“When I look around, I don’t have a business,” Ms. Rivera says 16 years later.

She laid off her last employee about two years ago, gave up her office space and went through $150,000 in savings. In the past eight months, she’s made two loans. Now, at 59 and with less than $100,000 left in her 401(k) account, she worries about retirement.

“I’m hoping that God gives me the strength to work much longer,” she say. “I’m really scared.”

All eyes have been on politicians in recent days as they hammer out a bailout deal, each side taking breaks to blame the other for negotiations breaking down. Meanwhile, phrases like “economic meltdown” and “crisis on Wall Street” have punctuated newspaper headlines and cable news tickers.

But as Wall Street and Capitol Hill have dominated the spotlight, the people at the story’s core are getting laid off and watching their investment portfolios dwindle. Some of them are putting off retirement while others are just sitting tight and waiting for the market to determine their fate.

For some, like Ms. Rivera, it may as well be the end of the world.

“The average consumer is confused because he feels that he’s done everything right and now the bottom is falling out,” says Gail Cunningham, spokeswoman for the nonprofit National Foundation for Credit Counseling. “They were told to buy a house because homeownership is a great wealth-building tool. Even if they were able to make a house payment, they have seen their value decline. They were told to save for their retirement, now they’re watching the value of their portfolio decline.”

This year, the NFCC expects to assist some 2.5 million people across its 900 offices.

“These are real-life people with real-life problems,” Ms. Cunningham says, “and it’s a shame to see the fear in their eyes.”

‘What am I going to live on?’

After separating from her husband in 1987, Ms. Rivera, who lives in Long Island, struggled to find a job that could accommodate her two children, then 8 and 10. She wanted something with a base salary and not just commission to ensure a steady stream of income, but also a position that would let her take care of them when school was over. She entered the mortgage lending business in 1991 after a string of different jobs, and established her own firm in 1992.

“I never grew it too big because I was always cautious about who I hired. My business was built only on referral, I didn’t advertise,” she says.

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