The U.S. trade war is giving many U.S. consumers in, or near, retirement, the financial jitters, which should push the issue of retirement security to the top of your reporting list this week.
By October 1, the U.S. Senate is due to pass a new budget, and retirement advocates are hoping that the SECURE Act (Setting Every Community Up for Retirement Enhancement Act of 2019), which passed the House of Representatives by a vote of 417-3 before Memorial Day, gets included. As reported earlier in this blog, SECURE would usher in the biggest changes to retirement rules since 2006.
Business reporters who answer the following questions on SECURE, and two additional pieces of critical retirement security legislation during this session of Congress, will get the attention of a wide swath of their readers:
How can retirees battle anxiety over the trade war?
By focusing on strategies that fight the financial jitters by lowering the volatility in their portfolios, avoid cashing out investments in panic, and postponing Social Security benefits. Delaying Social Security benefits for three to six months can add 1% of your salary a year for three decades, according to this 2018 study from the National Bureau of Economic Research (NBER). What changes have your readers made to their portfolios since the start of the trade war? Invite four to six readers to discuss the question. Your area’s senior resource center may have an expert on staff to interview. Christine Benz, Morningstar’s director of personal finance and Alicia Munnell at Boston College’s Center for Retirement Research are respected industry sources to tap.
What is the fate of Social Security?
Supporters and skeptics have been asking that question for years. The Social Security 2100 Act sponsored by 200 supporters in the U.S. House of Representatives proposes to raise taxes now to avoid higher taxes or benefit reductions later. Although 10,000 Baby Boomers turn 65 every day, more are staying in the workforce after 65, according to Pew Research. So will the system really run out of money by 2035 and be able to pay only 80% of promised benefits? That question will be sure to spark a lively debate among your Boomer, Gen, and Millennial readers. What are they counting on from Social Security in the future?
Can multiemployer pensions be rehabbed?
Many multiemployer pension plans are running out of money. The Rehabilitation for Multiemployer Pensions Act passed in the House of Representatives in July by a 264-169 vote likely won’t wrangle enough Republican support to become law, but the government’s Pension Benefit Guaranty Corporation (PBGC), which pays pension shortfalls, is expected to run out of money by 2025. That puts the retirement security of 1.3 million employees at risk. Interview employers and employees in local multiemployer plans about their concerns.