The U.S. is facing a retirement savings crisis that likely is worsening thanks to yet another economic crisis. Except for wealthier Americans, the typical working American is not on track to maintain their standard of living in retirement. The retirement savings shortfall can be attributed to many factors, including the move away from pensions, low wages, and a lack of employer-sponsored plans. Also, cuts to Social Security benefits and skyrocketing costs for health, longterm care and housing in retirement are exacerbating the retirement crisis. To assess Americans’ sentiment of retirement, NIRS conducted a survey of working-age Americans to measure their views on a range of retirement issues. The research finds that across party lines, Americans are deeply worried about retirement, the pandemic will impact retirement, and Americans see pensions and Social Security as important for rebuilding retirement readiness.

Women on Medicare worry more than men about their ability to pay future healthcare costs. Roughly two-thirds of females (66%) said they were either somewhat or very concerned compared to just over half (51%) of males. That’s among the key takeaways in this second report on a new healthcare cost survey of Medicare recipients 65 plus by MedicareGuide.com.

Working longer is often proposed as the solution to the retirement crisis caused by older workers’ lack of retirement assets. Spreadsheet models used by advocates of delaying retirement assume older workers delay claiming Social Security to accrue additional benefits. But in reality, by age 65, most older workers have already claimed Social Security, often to supplement low wages, and working longer does not increase their Social Security benefits. Working longer increases retirement savings significantly less than predicted by spreadsheet models, which don’t reflect older workers’ real experiences in the labor market. Finally, the drastic job loss experienced by older workers in the wake of the Covid-19 crisis reveals the risk older workers face when working longer is the policy substitute for an effective retirement security system.

Advisors and workers who previously used the Social Security Administration’s website to set up a mySocialSecurity account may recall that the verification process previously required users to answer a series of questions, pulled from information on file with credit bureaus. Common questions would include things like, “Which of the following streets have you lived on?” and, “Which of the following is a company through which you have previously held a line of credit?” The pressure some workers felt to answer the questions correctly would lead to anxiety, which only further increased the likelihood that they would answer one of the questions wrong! No more. Gone is the old system of requiring an exam-like series of questions about one’s past (though this still remains a secondary option for certain individuals). In its place, workers are now given a choice to verify their identity in one of two ways, the simplest of which is the ability to verify their identity using their smartphone and a state-issued ID card.

Philip Moeller, author of the helpful new book Get What’s Yours for Health Care, says you need to be your own advocate to save on health care expenses. “If people act like sheep, they’re going to get fleeced,” he said. This article, and the podcast that accompanies it, offer some advice on keeping your health costs down without sacrificing on quality.

Despite the sharp partisan divide in Washington, two surveys by The Senior Citizens League found broad agreement on several proposals that would bolster Social Security and Medicare. The findings come as the nation finds itself in a growing a retirement crisis. Even before the coronavirus-caused recession, the U.S. Government Accountability Office estimated that about 48 percent of households headed by people aged 55 and over had no retirement savings. That situation has been made even worse in 2020 and 2021 as older workers have lost jobs or seen their work schedules reduced due to the pandemic. The top five areas of consensus about proposed solutions:

A number of people think the concept of Social Security is unique to the United States. Or they figure that maybe a couple of those “socialist” countries, such as Sweden and Denmark, have social insurance programs in place, but surely not too many other places. Actually, just the opposite is true. Almost every country on the planet has a Social Security system in place for its citizens. And many of those countries had Social Security laws on their books long before the U.S. jumped on the social insurance bandwagon in the 1930s.

The Required Minimum Distribution (RMD) rule requires retirees to withdraw a minimum amount from their retirement accounts each year, and, if the withdrawals are too small, retirees must pay a 50% excise tax. Until recently, the RMD was computed such that the sum of the retiree’s annual payouts starting at age 70.5 was expected to exhaust her account balance by the end of her lifetime. The SECURE Act, passed in 2019, raised the age for RMDs for tax-qualified plans to 72, and additional proposals would delay it further or even abolish it. This paper examines the potential impact of RMD rule changes.

Women are concerned about the impact of the COVID-19 pandemic on their finances and the resulting uncertainty can make planning for the future—and their retirement—more difficult. For several consecutive years, the Nationwide Advisor Authority study has revealed the disconnect between women’s growing concerns about their ability to retire and their level of preparation—and the pandemic has taken this to new levels. While women are acutely aware of the challenges they face, it’s critical that they take steps now to address gaps in their retirement plan, especially as we start a new year.

Research conducted by The American College for Financial Services suggests that women’s retirement planning and income literacy trails that of men, based on a 38-question quiz testing knowledge on retirement planning, medical and longer-term care, life insurance, investing, and retirement income planning and strategies. Unlike men who claim to have higher levels of knowledge and then test poorly, women’s self-reported knowledge is more aligned to their actual literacy scores. Combined with their decision-making power and openness to advice, women represent a critical audience for financial advisors and financial services providers. Understanding how their approach to financial and retirement planning differs from men and by age, asset level, and racial or ethnic background is critical to building lasting relationships and developing products, services, and approaches that meet women’s needs.

Newly elected President Joe Biden has a tall list of priorities in his first days in office, with stemming the pandemic chief among them. But experts expect one issue he promised to deal with during his campaign, Social Security reform, could also become a focal point as soon as this year. The latest official estimate from the Social Security Administration shows that just 79% of promised benefits will be payable in 2035 due to depletion of its trust funds. That estimate does not factor in the effects of the pandemic, which experts say could move that date up even sooner.

The National Retirement Risk Index (NRRI) measures the share of American households that are at risk of being unable to maintain their pre-retirement standard of living in retirement. The NRRI compares households’ projected replacement rates—retirement income as a percentage of pre-retirement income—with target rates that would allow them to maintain their living standard and then calculates the percentage falling short. Since the Great Recession, the NRRI has shown that even if households work to age 65 and annuitize all their financial assets, including the receipts from reverse mortgages on their homes, roughly half of households are at risk. The last survey was done in 2019, but of course the world has changed dramatically since then. Here is a 2020 update.

A new list compiled by The Senior Citizens League (TSCL) indicates that, by late 2020, price increases for many of the expenditures of older Americans far outstripped the modest 1.3 percent cost of living adjustment (COLA) boost that Social Security recipients start receiving this month. “This list is a snapshot of how COVID-19 affected prices of certain items through the end of November 2020,” says Mary Johnson, a Social Security policy analyst for The Senior Citizens League. “There are surprising price aberrations that we haven’t seen before,” Johnson says. “Never in my wildest dreams would I have thought that toilet paper and disinfecting wipes could wind up on our annual list of fastest growing retiree costs,” Johnson says.

This paper uses financial data from a major credit bureau for a nationally representative 2 percent random sample from more than 250 million consumer records to examine the financial health and indebtedness of older adults. The data cover the years 2010 through 2019 and follow the same consumers over time. Consumer records include numerous sources of debt and information on their total credit available, total balances, amounts past due, debt in collections, and bankruptcies and foreclosures. Consumers ages 50 and older are decreasingly indebted since the Great Recession. This trend masks the increase in indebtedness among adults ages 70 and older due primarily to mortgages. Not only are they more indebted, but our findings suggest that their financial health—reflected by their credit scores and capacity to borrow—has worsened over time.

As a handful of states roll out employer-mandated retirement-savings programs for their workers, a group of researchers is now advocating for a nationwide policy, arguing that a universal mandate could dramatically boost savings rates and ease the strain on federal assistance programs. “There’s a significant gap in access to workplace retirement plans because employers in the United States are not required to offer a retirement savings plan to their employees, and we know that they are much more likely to save if they have that access—as much as 15 times more likely,” said Angela Antonelli, executive director of Georgetown University’s Center for Retirement Initiatives.

When a loved one receiving Social Security benefits passes away, you may wonder how the government knows to stop sending that monthly money. Or, maybe there’s a surviving spouse or dependent who relied on that income and wonders whether some sort of payment can continue. While Social Security rules can be complicated, the bottom line is that the decedent’s benefits stop at death. For survivors, how to get benefits—or whether you qualify—depends on several factors.

According to SSA policy, an underpayment is any monthly amount due a beneficiary that SSA has not been paid. Terminated beneficiaries include living and deceased beneficiaries who are no longer receiving benefits. SSA should issue underpayments to living terminated beneficiaries after it makes direct contact to obtain a current address and bank information. When underpaid beneficiaries are deceased, SSA should pay the underpayment to a surviving spouse, child, or parent or to the legal representative of the decedent’s estate. SSA’s systems identify underpayments for terminated beneficiaries and record them as a special payment amount underpayment on the Master Beneficiary Record.

Retirement planning is not just about building a nest egg. It’s also about knowing what questions to ask in order to reach the goal. Failure to ask the right questions could leave people unprepared for the retirement they hope to live. MoneyRates.com asked people within 20 years of retirement age or older how they’re planning for retirement. The survey found that a significant portion of the population doesn’t know much about retirement planning and doesn’t have the information they’d need to make good decisions. If knowledge is power, millions of Americans may be headed toward retirement powerless to control their financial futures.

For many Americans, Social Security income plays an integral role in retirement planning, and while retirement planning is generally straightforward for Americans with income solely from US employment that pays into Social Security, the situation becomes more complex when income from multiple countries is involved. As working in a foreign country may not count towards US Social Security benefits, either reducing benefits or even rendering the worker with insufficient quarters of coverage to be eligible for Social Security benefits at all. In addition, receiving non-US pension or foreign Social Security benefits can impact US benefits, and there is the potential for double-taxation of benefits when more than one country seeks to tax the same individual (the foreign country because the US citizen lives there, and the US because it taxes all citizens on all of their income worldwide!).

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