Latest news with #TCRS
Newsweek
a day ago
- Business
- Newsweek
Americans Fear End of Social Security as They Know It
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Seven in 10 Americans worry that Social Security won't be there for them when they retire, according to new survey from the Transamerica Center for Retirement Studies (TCRS). TCRS is a division of Transamerica Institute (TI), a nonprofit, private operating foundation, and conducts one of the largest and longest-running annual retirement surveys of its kind. For generations, Social Security, which celebrated its 90th anniversary on August 14, has formed the bedrock of retirement income for tens of millions of Americans, and also pays out benefits to disabled people and survivors of deceased workers. However, despite its enduring popularity and importance, it faces a looming insolvency crisis that lawmakers have less than 10 years to solve. The survey from TCRS, which polled 10,009 adults above the age of 18 between September 11 and October 17, 2024, found that among non-retirees, 71 percent agreed with the statement: "I am concerned that when I am ready to retire, Social Security will not be there for me." Almost nine in 10 Americans (87 percent) have one or more greatest retirement fears, ranging from health to financial. The top two greatest fears are declining health that would require long-term care (39 percent) followed by Social Security being reduced or ceasing to exist in the future (37 percent). According to the latest report from the Social Security Trustees, the program's two trust funds—the Old-Age and Survivors Insurance (OASI) and Disability Insurance (DI) funds—are projected to reach insolvency by 2034. At that point, benefits would be funded solely through incoming payroll taxes, triggering an automatic cut of around 21 percent unless Congress takes action. While several options have been tabled by lawmakers to fix the issue, such as The Fair Share Act and raising the retirement age, no meaningful progress has been made. Doug Carey, founder of WealthTrace and a chartered financial planner, told Newsweek that the main driver of fears around Social Security's longevity is this political inaction. "I believe it's the political climate and the lack of action over many administrations," he said. "Most politicians do not want to touch benefits since they believe it will only hurt their reputation and reelection chances now. That is why this keeps getting pushed into the future until it simply has to be addressed." Stock image/file photo: An elderly woman holding an empty wallet. Stock image/file photo: An elderly woman holding an empty wallet. GETTY The study also revealed Americans are concerned about seeing their personal savings through their post-working years. Sixty-three percent of Americans said they either believe they won't save enough to meet their needs by the time they retire or, if already retired, they failed to save enough—28 percent "strongly agree" and 35 percent "somewhat agree" with that statement. And for nearly a third of Americans—32 percent—Social Security is expected to be their primary source of retirement income. That compares with 29 percent who expect to rely primarily on retirement accounts, 12 percent on other savings and investments, and 11 percent on continued work. Only 9 percent see a company-funded pension as their main income source. The survey also showed that reliance on Social Security is even greater among retired women with six in 10 women retirees (59 percent) indicating it is their primary source of income, compared with 47 percent of men retirees. For those not yet retired, 29 percent of women and 22 percent of men said Social Security was their expected primary source of retirement income. Carey added that many Americans are already adjusting their retirement plans based on the assumption of reduced benefits. "What many people are doing is simply assuming their benefits will be cut by anywhere from 25 percent to 50 percent. They can then plan accordingly by retiring later, saving more, or changing their planned spending in retirement," he said. Some, Carey noted, choose to claim benefits early at age 62 to "lock in" payments, believing they are less likely to be reduced once started. Jackson Ruggiero, co-founder of told Newsweek that the poll's findings are unsurprising. "The program is facing real financial challenges, but just as importantly, people don't trust Congress to fix it in time," he said. "Because of this uncertainty, many people are changing how they plan for retirement. Younger workers especially are focusing more on personal savings through 401(k)s and IRAs, and some are assuming they'll get little or nothing from Social Security. That's understandable, but also a bit extreme." Looking forward, Ruggiero advised a balanced approach for those concerned about their retirement savings and the future of Social Security. "Plan like your benefits might be reduced, not gone. Save what you can now, take advantage of employer retirement plans, and if possible, delay taking Social Security to get a bigger monthly check," he said. Both experts agreed on one point—Congress is moving too slowly to fix the looming insolvency dilemma. "They are doing nothing, and I predict they won't do anything until the year where it's clear Social Security benefits will have to be cut. Currently that is 2033," Carey warned. This is not the first time Social Security has faced a funding cliff. In the early 1980s, the trust funds were similarly close to depletion. Lawmakers responded with reforms that included faster payroll tax increases, a gradual rise in the retirement age, and taxation of some Social Security benefits. "Social Security has served as the cornerstone of retirement income since its establishment nine decades ago. It provides millions of older Americans with guaranteed income, so that they can retire with greater financial security," Catherine Collinson, CEO and president of Transamerica Institute, said. "With the estimated depletion of the Social Security trust funds looming large, now is the time for policymakers to identify reforms that can help ensure the program's sustainability for the next 90 years."
Malaysian Reserve
4 days ago
- Business
- Malaysian Reserve
Social Security Is the Cornerstone of Retirement Income
New report spotlights the invaluable role of Social Security on its 90th anniversary LOS ANGELES, Aug. 14, 2025 /PRNewswire/ — Almost seven in 10 Americans (69%) are expecting Social Security as a source of retirement income, and 32% expect it will be their primary source of retirement income, according to Social Security Turns 90: The Cornerstone of Retirement Income, a survey-based research report released today by nonprofit Transamerica Center for Retirement Studies® (TCRS) in collaboration with Transamerica Institute®. To commemorate Social Security's 90th anniversary, TCRS published Social Security Turns 90: The Cornerstone of Retirement Income to highlight the program's vital role in helping Americans achieve a more secure retirement. The report examines people's beliefs, expectations, and reliance on Social Security. It also sheds light on their views on how to address its funding shortfalls. 'Social Security has served as the cornerstone of retirement income since its establishment nine decades ago. It provides millions of older Americans with guaranteed income, so that they can retire with greater financial security,' said Catherine Collinson, CEO and president of Transamerica Institute and TCRS. 'With the estimated depletion of the Social Security trust funds looming large, now is the time for policymakers to identify reforms that can help ensure the program's sustainability for the next 90 years.' How to address Social Security's funding shortfall 'Americans are anxious about the future of Social Security and what might happen to their benefits,' said Collinson. Among those who are not yet retired, seven in 10 people (71%) are concerned that Social Security will not be there for them when they are ready to retire. Amid widespread concerns about Social Security, the survey asked people how Congress should address its projected funding shortfall. Only 5% of people said that Congress should 'do nothing.' People's responses for specific reforms include increasing the maximum earnings subject to payroll taxes (38%), increasing the Social Security payroll tax rate (35%), preserving retirement benefit payments for retirees in greatest need (28%), and raising the retirement age (22%). One in four people (25%) say they 'don't know.' Current and future retirees are counting on Social Security 'Americans are counting on Social Security for retirement income to complement their employer-sponsored retirement benefits and personal savings,' said Collinson. More than half of retirees (53%) indicate Social Security will be their primary source of income throughout their retirement. Among those who are not yet retired, one in four people (25%) expect their primary source of retirement income to be Social Security, including 23% of people in the workforce, 59% of people who are not employed and not looking for work, and 37% of homemakers. The survey findings further illustrate the importance of Social Security for people's retirement security: Seven in 10 people who are not yet retired (70%) agree with the statement, 'I feel that I could work until retirement and still not save enough to meet my needs,' and 42% of retirees indicate that they were unable to save enough to meet their retirement needs. People who are not yet retired have saved $51,000 in total household retirement accounts, including people in the workforce ($65,000), homemakers ($16,000), and the unemployed who are not looking for work ($0) (estimated medians). Retirees have $126,000 in total household savings excluding home equity (estimated median). People in low- to moderate-income households are more reliant on Social Security 'Social Security is a meaningful source of retirement income for Americans across the wealth spectrum, and it is a lifeline for retirees with limited means,' said Collinson. Reliance on Social Security varies dramatically by household income (HHI). More than half of people with a HHI of <$50k (52%) expect Social Security to be their primary source of retirement income compared with 34% of those with a HHI of $50k to $99k, 21% of HHI of $100k to $199k, and 13% of HHI $200k+. Social Security reliance is especially prevalent among retirees with a HHI of < $100k. More than eight in 10 retirees with a HHI of <$50k (85%) and more than half of retirees with a HHI $50k to $99k (54%) cite Social Security as their primary source of retirement income. The survey findings highlight the importance of Social Security, especially for people at the lower end of the income spectrum: Three in four people with a HHI of <$50k (76%) agree they could work until retirement and not save enough to meet their needs or, if retired, indicate they were unable to save enough. Such concerns are less prevalent as HHI increases. Among those who are not yet retired, people with a HHI of <$50k have saved just $2,000 in household retirement accounts, while those with a HHI of $50k to $99k have saved $33,000, those with HHI of $100k to $199k have saved $147,000, and those with HHI of $200k+ have saved $565,000 (estimated medians). Retirees with a HHI of <$50k have $2,000 in household savings excluding home equity, compared with those with HHI of $50k to $99k who have $130,000, those with HHI of $100k to $199k who have $525,000, and those with HHI of $200k+ who have $997,000 (estimated medians). Women are more reliant than men on Social Security 'Women face societal headwinds that make it even more challenging to achieve a financially secure retirement. The persistence of the gender pay gap combined with taking time out of the workforce for parenting and caregiving puts many women at risk of inadequately saving for retirement. As a result, women have greater reliance than men on Social Security for retirement income,' said Collinson. According to the survey's findings, women are more likely than men to cite Social Security as their expected primary source of retirement income (36%, 27%, respectively). Reliance on Social Security is even greater among retired women. Almost six in 10 women retirees (59%) cite Social Security as their primary source of income, compared with 47% of men retirees. The survey offers insights why women are more reliant than men on Social Security: Women are more likely than men to agree that they could work until retirement and still not save enough to meet their needs or, if retired, that they were unable to save enough (67%, 60%, respectively). Among those who are not yet retired, women have saved $35,000 and men have saved $67,000 in total household retirement accounts (estimated medians). Retired women have saved $79,000 and retired men have saved $185,000 in total household savings excluding home equity (estimated medians). 'Social Security is the cornerstone of retirement income. Americans are paying into Social Security with the expectations of receiving the benefits they have been promised,' said Collinson. 'By implementing reforms to address the program's funding shortfall, policymakers can ensure its sustainability for future generations. The sooner policymakers act, the more time people will have to react and adjust their retirement plans accordingly.' Social Security Turns 90: The Cornerstone of Retirement Income is part of TCRS' 25th Annual Retirement Survey, one of the largest and longest-running surveys of its kind. To download the report, visit Follow on LinkedIn, Facebook, and X @TI_insights and @TCRStudies. About Transamerica Center for Retirement Studies Transamerica Center for Retirement Studies® (TCRS) is a division of Transamerica Institute®, a nonprofit, private operating foundation. TCRS conducts one of the largest and longest-running annual retirement surveys of its kind. The information provided here is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical, or financial advice or guidance. Please consult independent professionals for answers to your specific questions. About the 25th Annual Transamerica Retirement SurveyThe analysis contained in Social Security Turns 90: The Cornerstone of Retirement Income was prepared internally by the research team at Transamerica Institute and TCRS. It is based on an online survey conducted within the U.S. by The Harris Poll on behalf of Transamerica Institute and TCRS between September 11 and October 17, 2024, among a nationally representative sample of 10,009 adults. Data was weighted where necessary for age by gender, race/ethnicity, region, education, marital status, household size, household income, and smoking status. Respondents were selected from among those who have agreed to participate in our surveys. The sampling precision of Harris online polls is measured by using a Bayesian credible interval and the worker sample data is accurate to within ±1.2 percentage points using a 95% confidence level. This credible interval will be wider among subsets of the surveyed population of interest. Percentages are rounded to the nearest whole percent. Media Contact: Kyle Moschenkmoschen@
Yahoo
01-03-2025
- Business
- Yahoo
What is the Saver's Credit, and do I qualify?
(NewsNation) — Millions of Americans can get a tax break if they contribute to a retirement account, but many don't take advantage of it. The Retirement Savings Contributions Credit, or 'Saver's Credit,' is a tax benefit for low- to moderate-income taxpayers who contribute to a retirement plan like a 401(k) or individual retirement account (IRA). It's worth up to $1,000 for single filers and up to $2,000 for those who are married filing jointly, depending on how much they make and contribute to their retirement account. But the saver's credit is 'a well-kept secret,' Catherine Collinson, CEO and president of Transamerica Center for Retirement Studies (TCRS), said in a recent report. 4 ways to maximize your tax refund A recent TCRS survey found that just over half (51%) of U.S. workers know about the credit. That percentage is even lower (44%) among those who could qualify for it: households that bring in less than $50,000. According to the IRS, only 5.8% of tax returns claimed the Saver's Credit in 2022. Here's what to know about the Saver's Credit and how much you could save. The Saver's Credit allows eligible taxpayers to claim a tax break for contributing to a retirement account like a 401(k) or IRA. The credit can be worth up to $1,000 for single filers who contribute $2,000 to a qualifying retirement account. Married couples filing jointly can offset 50% of retirement contributions on as much as $4,000 — making the credit worth $2,000 to them. It's a tax credit, not a tax deduction, which means it lowers your tax bill dollar for dollar. 'A tax credit is the holy grail of tax benefits,' Mark Steber, chief tax information officer at Jackson Hewitt Tax Service, told NewsNation in a recent interview. For example: With a $1,000 tax credit, your $2,000 tax bill would be lowered to $1,000, whereas a tax deduction lowers your taxable income, not your tax bill directly. The downside is that the Saver's Credit is nonrefundable, meaning it can reduce the tax you owe to zero, but it won't provide you with a tax refund. That means those who don't owe federal income tax don't benefit. 7 key tax terms you should know The Saver's Credit is meant to help those with modest incomes build their nest eggs, so not everyone qualifies. To be eligible, your adjusted gross income (AGI) needs to fall within certain thresholds. Single filers must have an AGI under $38,250. Those who are married filing jointly can't have an AGI above $76,500. Of course, you'll also have to contribute to a retirement account, such as any of the ones listed here. Your AGI determines your credit amount, which can be either 50%, 20% or 10% of your retirement contribution. Those who make less can have more of their retirement contribution offset. Here's how the credit rates and income limits break down for tax year 2024 (taxes you file in 2025): Credit rate Married filing jointly Head of household All other filers* 50% of your contribution AGI not more than $46,000 AGI not more than $34,500 AGI not more than $23,000 20% of your contribution $46,001- $50,000 $34,501 – $37,500 $23,001 – $25,000 10% of your contribution $50,001 – $76,500 $37,501 – $57,375 $25,001 – $38,250 0% of your contribution more than $76,500 more than $57,375 more than $38,250 To qualify, you also have to be: Age 18 or older, Not claimed as a dependent on another person's return, and Not a student Find out if you qualify for the Saver's Credit using the IRS tool here. The size of the credit depends on your income and filing status, but it tops out at $1,000 for single filers and $2,000 for married couples filing jointly. The math works like this: The maximum retirement contribution that can go toward the credit is $2,000 for a single filer and $4,000 for a married couple. So, at the top credit rate, 50%, those contributions would be worth $1,000 and $2,000, respectively. Here are a couple of scenarios: A single filer with an adjusted gross income of $35,000 contributes $2,000 to an IRA. That person would be eligible for a 10% credit, offsetting their retirement contribution by $200. A married couple filing jointly with an adjusted gross income of $50,000 contributes $2,000 to an IRA. That couple would be eligible for a 20% credit, a tax benefit worth $400. In 2022, the average amount of the Saver's Credit was $194, according to TCRS. It's not too late to contribute to an IRA for the 2024 tax year. The IRS allows tax filers to put money in an IRA until April 15, 2025, and still get the tax break for 2024. What is a Roth IRA for kids, and how does it work? 'It is one of the only — if not the only thing — you can do after year-end up until the tax due date to affect last year's taxes,' Steber said. Putting money into an IRA could make you eligible for the Saver's Credit, but there are other tax benefits as well. For example, contributions to a traditional IRA can reduce your taxable income. The Saver's Credit is going away in 2027 and being replaced by a new program called the 'Saver's Match.' Instead of receiving a credit, eligible individuals will have money contributed directly to their retirement account paid by the U.S. Treasury. 'The new match has the potential to benefit millions of low-income households, as even those who don't pay federal income taxes will be able to claim the matching federal contribution to their retirement accounts,' the Bipartisan Policy Center noted in a recent report. According to the IRS, a qualifying taxpayer who contributes $2,000 to a retirement account like an IRA can receive as much as $1,000, which is matched by the Treasury. 'Saver's Match may create an incentive to save for some people that the Saver's Credit does not reach,' the Congressional Research Service wrote in a 2023 report. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
