SEATTLE -- With the way the economy and stock market have been lately, 401(k) statements may not be a pretty sight.

All 401(k)s have taken a beating during this economic crisis and that could mean workers will be working much longer than they expected.

A new study out Wednesday by the U.S. Bureau of Labor Statistics said the number of Americans working at the age of 65 will double in just eight years.

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That's due in part to rapidly dwindling retirement funds, including 401(k)s.

Stan Mansfield of Tacoma has worked as a carpenter for 33 years and he was hoping to retire soon, but his 401(k) is heavily invested in stocks, which have dropped up to 33 percent. He doesn't see the stock market rebounding in time to help him and his family.

"I'm pessimistic, yeah. To be honest with you, I don't think it will," Mansfield said.

Mansfield and many other investors like him may have rolled the wrong dice, even by the standard 401(k) allocation formula the financial community has used for years.

Under that formula, those under 40 years of age should be aggressive, putting as much as 100 percent of their 401(k) investments in stocks.

Those between 40 and 50 have been advised to put 80 percent in stocks and 20 percent in fixed income investments, such as bonds or money market funds.

The next decade shows a split between stocks and bonds, and a further gradual reduction in the stock market until retirement.

With the recent sharp drop in the stock market, this formula may not now appeal to under 40 people like Jordan Schenk of Seattle, who earlier this year had thought of investing in 401(k)stock market funds, but never got around to it.

"Now I'm very glad I put off that decision. So, 13 percent down in five days really doesn't help," Schenk said.

The sharp drop in the stock market has panicked many 401(k) investors into switching out of stocks.

Financial experts told KIRO 7 that's a bad idea. It would lock in the current losses that right now are only losses on paper.

"Because right now we're just looking at a lot of paper losses, it still feels bad, but it's just a paper loss until you sell it," said financial advisor Jeff Lehman.

Experts did say that your 401(k) should be diversified in a number of investments, not just stock funds.

The 401kHelpCenter.com has advice on how to make allocations of your 401(k) over your working life.

Jeff Lehman, author of "The Frugal Millionaires" has a Web site www.thefrugalmillionaires.com has interesting info including a survey people can take to gauge how frugal you might, or might not be.