Americans are so worried about Social Security running out of money, they are giving up their full retirement benefits.
Only 10% of non-retired Americans plan on waiting until they're 70 years old to receive the maximum payment from the government, according to the 2023 Schroders U.S. Retirement Survey. This includes 17% of people who are already near retirement age.
The decision is deliberate, said Deb Boyden, head of U.S. defined contribution at Schroders. Nearly three-quarters of non-retired investors — including 95% of people between the ages of 60 and 65 — are aware that waiting longer results in higher payments.
Just 13% said they were advised to begin taking benefits earlier than age 70, and around a third of respondents said they either wanted or needed access to the money. But the biggest reason, cited by 44% of respondents, is that they worry that the Social Security program will run out of money.
“We have a crisis of confidence in the Social Security system and it’s costing American workers real money,” Boyden said in a statement. “Fear about the stability of Social Security has people walking away from money that could improve their quality of life in retirement. Many are not even waiting for their full benefit let alone the maximum, which means they will have to create more income on their own, making it even more important to save and invest earlier for retirement.”
The Congressional Budget Office estimates that the main Social Security trust fund will be depleted within a decade. Congress has been unable to pass a long-term solution to continue financing the program.
In July, President Joe Biden nominated former Maryland Governor Martin O’Malley as the next commissioner of the Social Security Administration to protect the program “for generations to come.” His appointment needs to be confirmed by the Senate, which could be difficult thanks to partisan divides.
Schroders' retirement study includes responses from 2,000 U.S. investors between the ages of 27 and 79 with a media household income of $75,000.
The study also found that working with a financial advisor pays off in the form of higher average monthly incomes in retirement than for those who don’t work with a financial advisor.
Having a financial plan goes even further. Those with a formal financial plan reported an average monthly income of $5,810, nearly twice the average income of those without a financial plan.
Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.
From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.
"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.
Chair also praised the passage of stablecoin legislation this week.
Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
