During the pandemic, the U.S. Social Security Administration leaned into providing more services and processing applications online. But that has furthered the agency’s disconnect with Native Americans living miles from its field offices in rural areas with poor internet access. That’s one conclusion from a new study of the agency’s effectiveness in reaching Native American and Alaskan Native populations. The study included some analysis of data on these communities but was based largely on interviews with tribal leaders, community members, advocates, and the government staff who assist people ..read more

When people aren’t getting a government benefit they’re eligible for, the program’s goal of improving equity is compromised. Social Security’s disability insurance is an example. Roughly half of the 20 million adults who have a disability that limits or completely prohibits them from working are receiving the benefit. Not all of them would meet the program’s criteria for eligibility. But research based on a survey of workers and interviews with people with disabilities reveals some of the reasons they decide to not even try to apply. An analysis of the survey data shows that the decision is, t ..read more

Let’s see if we agree on what the retirement age is today. With the projected depletion of the Social Security trust fund assets in the 2030s, policymakers are looking for ways to bridge the gap.  One of the major proposals is to increase the retirement age.  Certainly, with average life expectancy increasing, longer careers could be one way to ensure an adequate retirement with less reliance on Social Security.  The problem is that life expectancy varies significantly across the income spectrum, and the gains in life expectancy have been much greater for the wealthy than for th ..read more

The Inflation Reduction Act signed by President Biden in 2022 somewhat limits how much retirees will pay out of their own pockets for medications this year. Next year, the law imposes a hard cap of $2,000. But while retirees are getting a reprieve from Congress, insurance companies are pushing in the opposite direction. According to research appearing in Health Affairs, insurers are tightening retirees’ access to some medications and increasing the number that are excluded from Part D and Medicare Advantage plan coverage altogether. Ultimately, this might either cost retirees more or, in the m ..read more

The brief’s key findings are: When the employer cost for employer-sponsored health insurance (ESHI) rises, it slows wage growth and erodes Social Security’s tax base. Both these effects were evident from 1996-2005, but the situation stabilized during 2005-2019. Why did the ESHI-to-compensation ratio stabilize? During both periods, the major driver was the general rise in national health costs. From 2005-2019, this impact was largely offset by less ESHI participation by lower earners and less demand for family plans. Going forward, rising health costs could again push up the ESHI ..read more

The negative financial consequences for individuals over age 50 who lose a partner are dramatic. A new study by Ohio State researchers found that the surviving partners see their credit scores drop by 10 points – a decline that persists for up to two years following the partner’s death. Further confirmation in this study of the financial fallout is the rise in delinquencies on debt payments. If the late payments involve credit cards, for example, they can expose the fragility of the survivor’s finances. A Federal Reserve study found that nearly half of retirees roll over some or all of their c ..read more

A series of studies suggests tempered optimism at best. Larry Fink, in his annual letter to Blackrock investors, once again raised the question about the appropriate retirement age.  Certainly, with life expectancy and health improving – at least for a portion of the population – longer careers could be one way to ensure an adequate retirement.  But workers are just one side of the market.  The other side is employers.  Are employers willing to hire and retain them?  My colleague Geoff Sanzenbacher just completed a capstone brief summarizing several recent studies that ..read more

Virtually all high-income workers in this country are saving in some type of employer retirement plan. But only a minority in the lowest-income group are. A new study tackles this serious shortfall for disadvantaged workers in service, retail and other low-paying jobs. The crux of the problem, the researchers find, is that they lack easy access to a retirement savings plan at their jobs. This analysis, by establishing a direct connection between access to an employer-based plan and the act of saving, goes on to show that national legislation would greatly boost the financial security of low- a ..read more

Financial advisers often encourage older workers to delay signing up for their Social Security as long as possible to maximize their monthly income. But several of our blog’s readers point out, rightly, that this isn’t always possible for people in physically taxing jobs. Blue-collar workers are in a real Catch-22, caught between the unforgiving financial demands of retiring and a body that can’t take any more work. “That’s me,” a reader named George L. commented on a recent blog, “The Psychology Behind Starting Social Security at 62.” Psychology had little to do with his decision to start S ..read more

Good news for wages and Social Security tax base, but will costs stay flat? Health care costs are a large and growing share of the nation’s GDP.  One way those costs feed into the general economy is through employer contributions to employer-sponsored health insurance (ESHI).  Economists generally assume that the costs of employer benefits – in this case health insurance – are passed onto the employee, leading to slower wage growth and thereby the erosion of the Social Security wage base.  Both these effects were evident in the decades before 2005, as ESHI increased as a share o ..read more