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In 2025, millions of retired Americans will see a 2.5% cost-of-living adjustment for benefit payments, according to the Social Security Administration. The Social Security Administration on Oct. 10 unveiled a higher threshold for earnings subject to Social Security payroll taxes, known as the “taxable maximum” or “wage base.”The limit shifts annually based on the national average wage index. How the Social Security tax calculation worksThe Social Security payroll tax rate is 12.4%, with workers paying 6.2% through paycheck deductions. Concerns over Social Security solvencyThe latest Social Security adjustments come amid growing concerns about the program’s solvency. In the meantime, some advocates have pushed to increase the Social Security wage base to provide more funding.

Persons: Sean Lovison, “, Lovison, ’, Alicia Munnell Organizations: Social Security Administration, Social, Social Security, Medicare, Security, Center for Retirement Research, Boston College Locations: Philadelphia

☆ Social Security cost-of-living adjustment for 2025: Here's how benefits may change
▼ + stars: | 2024-10-09 | by ( Lorie Konish | ) www.cnbc.com time to read: +3 min

The Social Security cost-of-living adjustment, or COLA, could be 2.5% next year, Mary Johnson, an independent Social Security and Medicare analyst, predicted last month. The Social Security Administration is expected to announce the COLA for 2025 on Thursday. Social Security COLAs have averaged about 2.6% over the past 20 years, according to the Senior Citizens League. More from Personal Finance:House may force vote on bill affecting pensioners' Social Security benefitsWhy children miss out on Social Security survivor benefits72% of Americans worry Social Security will run out in their lifetimesCould the Social Security COLA estimate change? The official Social Security cost-of-living adjustment will factor in one more month of government inflation data when it is announced.

Persons: Mary Johnson, Joe Elsasser, Elsasser, Alicia Munnell, Johnson, Hurricane Helene Organizations: Social, Social Security, Social Security Administration, Senior Citizens League, Center for Retirement Research, Boston College, Finance, Urban, Clerical Workers

☆ Homeowners may be 'overconfident in their retirement readiness,’ economist says. Here’s why
▼ + stars: | 2024-09-12 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: +1 min

Owning a home makes some people feel more confident about their prospects for retirement — but that may be misguided, some experts say. Of those who said they were ahead or on schedule, 42% cite an early start in retirement savings helped them get ahead. The survey polled 6,657 adults, including 2,603 retired adults and 4,054 adult workers, in August. "Homeowners are actually more likely to be overconfident in their retirement readiness," Chen said. "There's a lot of misconception in terms of how people assess whether they are ahead or not in retirement."

Persons: SurveyMonkey, Angie Chen, Chen, Winnie Sun Organizations: Finance, Center for Retirement Research, Boston College, Homeowners, Sun Group Wealth Partners Locations: Irvine , California

☆ High inflation harms older households — and two factors determine who is most at risk, research finds
▼ + stars: | 2024-05-15 | by ( Lorie Konish | ) www.cnbc.com time to read: +4 min

This year, Social Security beneficiaries saw a 3.2% increase to their benefits. The Social Security cost-of-living adjustment may also be 3.2% in 2025 based on the latest government inflation data, estimates Mary Johnson, an independent Social Security and Medicare policy analyst. That estimate may change between now and October, when the Social Security Administration announces next year's cost-of-living adjustment, or COLA. The average Social Security COLA has been 2.6% over the past 20 years, according to The Senior Citizens League. Many households tend to cut back on savings and increase withdrawals to try to lift themselves to where they were before inflation picked up.

Persons: Lourdes Balduque, Mary Johnson, Social Security COLA, Laura Quinby, It's, Quinby, Warren Buffett's Organizations: Social, Social Security, Social Security Administration, Senior Citizens League, Center for Retirement Research, Boston College, Center for Retirement, Finance

☆ Writing your will is 'not just a question about finances,' expert says. Here's why it's a crucial task
▼ + stars: | 2024-05-08 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: +2 min

If the bank were to throw a $500 incentive on top of that aid, 75.6% said they would do it. However, survey respondents saw that workload as a detriment. About 40%, of U.S. adults feel they do not have enough assets to prepare an estate plan or a will, a 21% jump compared with 2022, according to Caring.com's 2024 Wills and Estate Planning Study. "Wills and estate planning are essential for everyone, not just the wealthy," Patrick Hicks, general counsel of Trust & Will, a digital estate planning and probate platform, said in the Caring.com report. Not having the proper estate planning documents in place can put your loved ones in a difficult situation in a catastrophic event, Cornell explained.

Persons: Wettstein, Wills, Patrick Hicks, Cornell Organizations: Center for Retirement Research, Will Locations: U.S

☆ More people are working well past retirement age. It’s not easy
▼ + stars: | 2024-04-14 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +11 min

So last October, at the age of 80, Murray ended her retirement and got a job giving out samples at Costco. Forecasters expect that cohort of older , working Americans to double over the next decade. “More people are working at desk jobs that don’t require much physical labor,” said Gal Wettstein, a senior research economist at the Center for Retirement Research at Boston College. “That’s people who are changing jobs, younger workers and non-college educated workers.” Older workers tend not to change jobs, and they’re more likely to have a college degree. The Age Discrimination in Employment Act (ADEA) forbids age discrimination against people who are age 40 or older in the workplace.

Persons: Hope Murray, ”, Murray, she’ll, “, Murray isn’t, Gal Wettstein, Monique Morrissey, ” Morrissey, What’s, Heidi Brockway, Brockway, Morrissey, ageism, Bob Vaughn, Wettstein, Vaughn, Mary Susan, they’ve, Mary Susan’s, they’d, They’re, Diane Reiter, ” Reiter, she’s, I’d, She’s Organizations: New, New York CNN, Gas, Costco, ”, Pew Research Center, Center for Retirement Research, Boston College, Economic Policy Institute, Social, Social Security Agency, Social Security, Lawmakers, AARP, Retirement Research, Amazon, Economic, Worker, Brookings Locations: New York, Hollywood, San Diego, Los Angeles, Southeast Florida, Florida, United States, Charlotte , North Carolina, Asheville, Chicago

☆ 3 things America can do to solve its retirement crisis, according to BlackRock chief Larry Fink
▼ + stars: | 2024-03-26 | by ( Jennifer Sor | ) www.businessinsider.com time to read: +5 min

Read previewAmerica has a real retirement crisis on its hands — and there are three things it can do to help solve it, according to BlackRock chief Larry Fink. In his annual letter to investors, the CEO of the world's biggest asset manager pointed to an unfolding crisis for current and future retirees. 46% of Americans aged 55-65 don't have any cash invested in a personal retirement account, according to 2022 Census data. Help retirees spend their savingsMost retirees are uncomfortable dipping into their pile of savings. Give young people a reason to want to investFear is one of the main obstacles preventing young people from investing in their retirement, Fink said.

Persons: —, Larry Fink, Fink, " Fink, AARP —, BlackRock, I've, Gen Zers Organizations: Service, BlackRock, Center for Retirement Research, Business, Security, Congressional, Office, Insurance Trust Fund, Social Security, AARP, University of Michigan, America, McKinsey & Company Locations: America, Australia, BlackRock

☆ Meet the Americans who can't retire
▼ + stars: | 2024-03-23 | by ( Juliana Kaplan | ) www.businessinsider.com time to read: +12 min

More people over 65 are working as pensions disappear, people live longer, and Social Security benefits are seemingly always in peril. Business Insider spoke with several Americans of retirement age about why they are still trading their time for money. "I think older people become very invisible, and maybe it's going to take other older people to help heighten that visibility." On average, Americans who have pensions receive $25,000 annually from them; the average estimated annual Social Security benefit is $38,418 for 2024. Indeed, BI's analysis of retirement data has found that nearly 80% of retirees have Social Security income.

Persons: —, Marcia, I'm, hasn't, she's, Steve Biddle, he's, He's, he'll, Bill, Geoffrey Sanzenbacher, Sanzenbacher, they're, Debra Giarrusso, She's, didn't, I've, there's, Pam, Kurt Vonnegut's, David Certner, Certner, Rebecca, It's Organizations: Service, Business, Social Security, Behavioral Health, Disability, Aging, —, Boston College, Center for Retirement Research, Congressional Research Service, Ford Motor Company, AARP Locations: North Carolina, Connecticut, Philadelphia, America, Michigan

☆ Why millennials' retirement outlook may be worse than older generations
▼ + stars: | 2024-02-09 | by ( Greg Iacurci | ) www.cnbc.com time to read: +9 min

'Deteriorating' retirement outlookAbout 38% of early millennials (those born in the 1980s) will have "inadequate" retirement income at age 70, according to projections from a 2022 Urban Institute study. watch now"We do see the retirement outlook deteriorating for future generations," including millennials, said Richard Johnson, director of Urban's retirement policy program and co-author of the report. Millennials' student loans dent their net worthA 2021 paper by the Center for Retirement Research at Boston College had similar findings. Meanwhile, the last major Social Security overhaul, in 1983, gradually raised the program's "full retirement age" to 67 years old. That will make it easier to save for retirement, according to a Brookings Institution report.

Persons: Jamie Grill, Craig Copeland, Gen X, Xers, Richard Johnson, Johnson, aren't, Millennials, Gen Xers, CRR, X, EBRI, Anqi Chen, Copeland, millennials, they're, William Gale, Hilary Gelfond, Jason Fichtner, there's, Sean Deviney, Deviney Organizations: Social Security, Research Institute, Urban, Center for Retirement Research, Boston College, Research, Transamerica Center, Retirement Studies, Finance, IRA, Pensions, Social, Center, Budget, Brookings Institution, Vanguard Group Locations: U.S, Fort Lauderdale , Florida

☆ To shore up Social Security, this controversial proposal calls for limiting retirement plan tax perks
▼ + stars: | 2024-02-09 | by ( Lorie Konish | ) www.cnbc.com time to read: +4 min

But a new research proposal published by the Center for Retirement Research at Boston College by experts at the opposite ends of the political spectrum has sparked considerable opposition. Together, they call for limiting current tax preferences for retirement savings plans, and instead redirecting those funds to help shore up Social Security. How retirement plan tax incentives workIn 2024, the limit for total employee and employer contributions to a defined contribution plans such as 401(k)s is $69,000 in 2024. By rolling back the tax incentives provided through defined contribution retirement plans, the money saved could be used to help fix a portion of Social Security's funding gap, the researchers argue. "We now have an industry and a policy based on 401(k)s and defined contribution plans that has been, relatively speaking, successful," Fichtner said.

Persons: Andrew Biggs, Alicia Munnell, Biggs, Munnell, Michael Wicklein, Jason Fichtner, Fichtner Organizations: Istock, Getty, Center for Retirement Research, Boston College, American Enterprise Institute, Federal Reserve Bank of Boston, Social Security, U.S, Mercatus, George Mason University, Cato Institute, National Association of Plan, Center, Board

☆ With Social Security trust funds 'rapidly heading to zero,' some ask whether the money should be invested in equities
▼ + stars: | 2023-10-05 | by ( Lorie Konish | ) www.cnbc.com time to read: +1 min

The trust funds that Social Security relies on to pay benefits are "rapidly heading to zero," according to the Center for Retirement Research at Boston College. Those funds, which are typically invested in Treasury securities, are projected to run out in 2034, at which point just 80% of benefits may be payable. As that date draws closer, that has prompted more discussion as to whether that money should also be invested in stocks. "Theoretically, yes," said Anqi Chen, senior research economist and assistant director of savings research at the Center for Retirement Research, which recently published research addressing the question. More from Personal Finance:Here's what happens to Social Security benefits after you dieAs student loan bills resume, how economy may be shakenHow Congress may fix looming Social Security benefit shortfallBut the real-world answer is not necessarily clear-cut, Chen and other experts say.

Persons: Anqi Chen, Chen, Peter G Organizations: Social, Center for Retirement Research, Boston College, Finance, Social Security, Security, Peterson Foundation Locations: New York

☆ NextEra workers roll the dice with big bet on company stock
▼ + stars: | 2023-09-21 | by ( Tim Mclaughlin | ) www.reuters.com time to read: +8 min

America’s largest renewable power company is among several U.S. energy and utility companies, including Exxon and Southern Company, that continue to promote big, concentrated bets on company stock in worker retirement plans. Nearly 50% of the investments in NextEra’s employee-funded 401(k) retirement plan are in company stock, the highest among all 30 companies in the S&P 500 Utilities Sector (.SPLRCU). NextEra declined to comment on its use of company stock in employee 401(k) plans. "If we saw a concentration of more than 20% in a single company stock, we would definitely tell them it's a big risk." `Keith Rasmussen, a retired geologist, said he still feels the financial repercussions of holding big bets on company stock in his retirement plans.

Persons: Robert Knoche, Yoon, NextEra, ”, Alicia Munnell, Kristin McKenna, McKenna, Ryan Frazier, Keith Rasmussen, jolt, Rasmussen, “, ” Rasmussen, Richard Valdmanis, Anna Driver Organizations: REUTERS, Exxon, Southern Company, Corporate America, Enron, Utilities, Vanguard Group, Center for Retirement Research, Boston College, Employees, Silicon Valley Bank, Darrow Wealth Management, SEC, Corporations, U.S . Securities, Exchange Commission, Southern Co, Dominion Energy Inc, Dominion, Chesapeake Energy Corp, Thomson Locations: Douglas County , Kansas, U.S, Silicon, Boston, Atlanta , Georgia

☆ Student-loan borrowers risk losing Social Security benefits if they fall behind on payments. Democrats want to make sure that doesn't happen when repayment starts back up next month.
▼ + stars: | 2023-09-14 | by ( Ayelet Sheffey | Juliana Kaplan | ) www.businessinsider.com time to read: +4 min

Student-loan borrowers who miss payments risk having their Social Security benefits garnished. "It's past time Congress protects seniors and the Social Security benefits they have earned with every paycheck." Those Social Security recipients are at risk of seeing around $2,300 in benefits garnished every year if they go into default. On October 1, millions of federal student-loan borrowers will once again be footing an extra monthly bill. "For many, Social Security benefits are the only source of income they can depend on and it's time we restore that certainty for seniors."

Persons: that's, Raúl Grijalva, John Larson, Ron Wyden, Wyden, they're, she's, Grijalva Organizations: Social, Service, Social Security, Center for Retirement Research, Retirement Research, Education Department, eBay, Seniors Locations: Wall, Silicon

☆ The rich often misjudge the potency of their retirement savings, report finds
▼ + stars: | 2023-06-12 | by ( Greg Iacurci | ) www.cnbc.com time to read: +5 min

Thirty-two percent of high-income households are "not worried enough" about their retirement risk, a larger share than the 26% of low- and middle-income earners. The Center for Retirement Research uses the survey data to construct a National Retirement Risk Index. The index models retirement preparedness according to a range of assets like Social Security, pensions, home equity and employer-sponsored retirement plans, such as a 401(k). Anqi Chen assistant director of savings research, Center for Retirement Research at Boston CollegeIn 2019, 47% of American households were at risk of not being able to maintain their standard of living in retirement, according to the index. Why the rich are more likely to underestimate riskWestend61 | Westend61 | Getty ImagesNineteen percent of U.S. households correctly identify as being at risk of falling short in retirement, according to the center's report.

Persons: Anqi Chen, Chen, they're, David Blanchett, Louis Organizations: Getty, Center for Retirement Research, Boston College, Finance, GOP, Federal Reserve's Survey, Consumer Finances, Retirement Research, Social Security, for Retirement Research, Westend61, Prudential Financial, Federal Reserve Bank of St, Center for Locations: U.S, PGIM

☆ Divorce Can Wreck a Woman’s Financial Future. Here’s How to Rebuild.
▼ + stars: | 2023-05-13 | by ( Lela Nargi | ) www.nytimes.com time to read: +2 min

At the time, I smugly demurred, but eventually there was no denying she had been right. Although this money would theoretically be equitably divided when divorce papers were signed, I realized the precarious situation I had unwittingly set myself up for: I’d relinquished control over my financial future. Facing reduced income and the extra expenses that come with divorce proceedings, wresting it back would be painful. Preparing for a financial setbackI’m hardly alone. Women of color are also disproportionately affected because of a wider gender pay gap.

☆ A retirement-savings gap may cost the economy $1.3 trillion by 2040. How state-run programs can fix it
▼ + stars: | 2023-05-12 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Many Americans aren't saving enough for retirement — and the shortfall could pressure state and federal budgets in the decades ahead. But research shows that state-run programs could help people save for retirement while reducing that strain. Without changes, the retirement-savings gap could create a $1.3 trillion economic burden through 2040, with increased public assistance costs, lower tax revenue and more, according to a study released Thursday by the Pew Charitable Trusts. If the current trends continue, 61% of elderly households are expected to have an annual income below $75,000 in 2040, and the yearly income shortfall is projected to be $7,050 by the same year. Roughly half of working households may struggle to maintain their pre-retirement standard of living in their golden years, the Center for Retirement Research at Boston College reported this week.

☆ Some Republicans want Gen Z to retire later to avoid outright cuts to Social Security: 'Does it really make sense to allow someone who's in their 20s today to retire at 62?'
▼ + stars: | 2023-03-14 | by ( Jason Lalljee | ) www.businessinsider.com time to read: +6 min

Several Republicans have said recently that they want to raise the retirement age for younger generations. Social Security is rapidly approaching insolvency, with the Congressional Budget Office estimating that the fund will become unable to make all of its payments starting in 2033. Social safety net programs like Medicare and Social Security have been a partisan battleground for Democrats and Republicans for decades now, with Republicans eyeing big cuts for both programs. There are going to be no cuts in Medicare, Social Security." The White House has continued to criticize Republicans for not being publicly consistent about their goals for Social Security and Medicare.

☆ Millennials in their 30s are sitting in an economic quagmire that could stick with them through retirement
▼ + stars: | 2023-03-08 | by ( Jason Lalljee | Madison Hoff | ) www.businessinsider.com time to read: +7 min

In the long run, this generation may also be hit by cuts in Social Security benefits. In the longer run, millennials' retirement may also be affected if Social Security benefits are cut. Millennials in their 30s are accruing debt faster than their peersWhile Experian and Credit Karma research show Gen X has the highest average debt, millennials still hold a lot of debt too — and are accumulating it faster than anyone else. Millennials face looming retirement insecurityIf all of that wasn't enough, millennials' retirement situation in the future could be different from Gen X and baby boomers. Additionally, millennials' retirement safety nets are likely to be affected if they can't get full Social Security benefits.

☆ As Social Security's full retirement age moves to 67, some experts say it should not go higher
▼ + stars: | 2023-02-12 | by ( Lorie Konish | ) www.cnbc.com time to read: +3 min

Pekic | E+ | Getty ImagesMore than 1 million people recently took to the streets in France to protest an increase in the country's standard retirement age. The full retirement age for Social Security, when workers are eligible for 100% of the benefits they've earned, is transitioning to age 67. Based on their proposal, people born in 1978 or later would have a full retirement age of 70. watch nowThe Republicans also propose raising Medicare's eligibility age to coincide with the Social Security full retirement age and then indexing that age to life expectancy. "I think that's about as far as you can go," Munnell said of the age 67 full retirement age that is getting phased in now.

☆ Delinquent student loans can reduce Social Security by $2,500 a year
▼ + stars: | 2023-01-05 | by ( Lorie Konish | ) www.cnbc.com time to read: +5 min

Getty ImagesIf you are delinquent on federal student loans and collect Social Security benefits, you may have your monthly checks reduced. Social Security benefits are typically subject to partial withholdings after prolonged federal student loan delinquencies. Today's Social Security beneficiaries who are behind on federal student loans are not subject to benefit withholdings, as those collections have been suspended as part of the federal student loan payment pause that has been in effect since March 2020, Minsky noted. "No one is having their Social Security checks garnished right now," Minsky said. How policy may influence debtsBiden has proposed broad student loan forgiveness of up to $10,000 for federal student loans, or up to $20,000 for Pell grant recipients.

The number of working Americans aged 80 or over — such President Joe Biden — has risen from 1980. As seen in the above chart, 5.16% of Americans aged 80 and over had a job in 2022 as of October. Although the share of Americans age 80 and over with a job has tumbled some from it's high in 2018 per Insider's analysis, there are still plenty of older workers working past typical retirement age. And that's evidenced by poverty rates among older Americans standing higher than a decade ago as of 2021. However, not all older Americans want to keep working as they get older and will exit the labor force.

☆ How the crypto fallout could affect you
▼ + stars: | 2022-11-15 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +8 min

New York CNN Business —The crypto industry is still reeling from last week’s shocking death spiral of digital currency exchange FTX. While these funds say they had limited exposure to FTX, their inclusion points to a growing but alarming trend that could affect you even if you’re not a buyer of crypto yourself. What’s happening: Pension funds are increasingly investing in alternative assets in search of bigger returns. In the United States, public pension funds are facing serious challenges that threaten the retirement plans of millions of state and local government employees. It’s not just a trend that’s happening in the United States.

☆ How a Part-Time Job Can Affect a Retiree’s Finances
▼ + stars: | 2022-11-14 | by ( Lori Ioannou | ) www.wsj.com time to read: 1 min

Earning extra cash in retirement can increase your taxes and how much you pay in Medicare premiums. U.S. seniors are facing a double whammy. Inflation has eroded their spending power, and this year’s dismal stock market has put a big dent in their nest eggs. The Center for Retirement Research at Boston College calculates total wealth lost from individual retirement accounts and 401(k)s since the beginning of the year at $3.3 trillion. As a result, many seniors will be tempted to take on side jobs to supplement their primary employment or other source of income.

☆ What a record 8.7% Social Security cost-of-living adjustment could mean for taxes on benefits
▼ + stars: | 2022-10-20 | by ( Lorie Konish | ) www.cnbc.com time to read: +5 min

Halfpoint | Istock | Getty ImagesRetirees who rely on Social Security benefits for income will get some relief from record high inflation when an 8.7% cost-of-living adjustment kicks in next year. How Social Security benefits are taxedSocial Security benefits are taxed based on a formula known as "combined" or "provisional" income. That is calculated by taking your adjusted gross income and adding non-taxable interest and half of your Social Security benefits. Taxes on Social Security benefits apply to single taxpayers starting with $25,000 in combined income, and married taxpayers starting with $32,000 in combined income. watch nowFor individuals with more than $34,000 in combined income and couples with over $44,000, up to 85% of their Social Security benefits may be taxed.

☆ Mark Cuban explains why he didn't retire early despite his wealth: 'I'm not retired because I'm too competitive'
▼ + stars: | 2022-10-16 | by ( Jason Lalljee | ) www.businessinsider.com time to read: +4 min

Entrepreneurs Mark Cuban and Kevin O'Leary found early retirement unfulfilling. "Working is not just about money," O'Leary said. In 1991, the average retirement age was 57, and in 2022 it is 61, Gallup data from the past 21 years shows. Thirty-six percent of older Americans can't afford one year of basic elder care, the Center for Retirement Research found. Depending on how lawmakers attempt to address the program's solvency issues going forward, the normal retirement age might get pushed even higher.

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