401(k) Specialist Issue 2 - 2024 - 4

401(k) NEWS YOU CAN USE
Retirees Report 'Living a Nightmare'
Ongoing inflation, along with retirement longevity, are among the
top concerns that retirees face today. Eighty-nine percent of those surveyed
said they are at least slightly concerned over inflation lessening
the value of their assets, while 68% noted concerns of outliving assets.
Over a third of retirees surveyed use a pension plan (38%) or a
spouse's pension plan (34%), while 22% take their savings from a 401(k),
403(b) or 457 plan, and 24% utilize retirement vehicles from a spouse.
While retirees with a pension plan today could breathe comfortably
with guaranteed income for life, Deb Boyden, head of U.S. Defined
Contribution at Schroders, warns it may not be the case for future
generations, as more companies phase the defined benefit (DB) plan
out of retirement benefits.
" The corporate pension plans that are being relied upon by today's
IN A TIME where market uncertainty continues to linger, more Americans
are growing worried about their future retirement savings, finds
the first set of data from Schroders' 2024 U.S. Retirement Survey.
The study finds that just 44% of Americans in retirement believe
they have saved enough, while 24% are unsure and 32% remain convinced
that the haven't accumulated sufficient savings.
retirees may not be there for all retirees in future generations, " she
said. " This shift in how Americans will be meeting their expenses in retirement
moving forward underscores the urgency for bolder actions
from retirement savers, plan sponsors and asset managers. We can
and should do more to improve the economic security of tomorrow's
retirees. "
9 Years Until Social
Security Trust Fund
Becomes Depleted
ABSENT CONGRESSIONAL ACTION, we're down to just 9 years until
Social Security's trust fund will become depleted, according to the
latest Social Security Board of Trustees annual report. But instead of
just 77% of benefits being payable at that time, the new report on the
financial status of the Social Security Trust Funds says 79% of scheduled
benefits will be payable.
The report also confirmed Social Security will be able to pay 100% of
total scheduled benefits until 2033, which is unchanged from last year's
report.
In a press release, the Trustees highlighted that the combined asset
reserves of the Old-Age and Survivors Insurance and Disability Insurance
(OASI and DI) Trust Funds are projected to have enough dedicated
revenue to pay all scheduled benefits and associated administrative
costs until 2035, which is actually one year later than projected last
year, with 83% of benefits payable at that time.
The report said projected long-term finances of the combined OASDI
fund improved this year primarily due to an upward revision to the level
of labor productivity over the projection period and a lower assumed
long-term disability incidence rate. These improvements were partially
offset by a decrease in the assumed long-term total fertility rate. The
revision to labor productivity was based on stronger economic growth
in 2023 than had been anticipated in last year's reports. The Trustees
lowered the long-term disability incidence and fertility rate assumptions
based on continued low levels in both series.
View the 2024 Trustees Report at www.ssa.gov/OACT/TR/2024/.
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401(k) Specialist Issue 2 - 2024

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