Retirement Matters
February 2024
U.S. Household Net Worth — The U.S Household Net Worth (or assets less liabilities) reached a new peak in 2024 as the unemployment rate and household debt were near record lows. This gain was not shared equally within the U.S. economy, due to the wealth gap, as reported by the New York Times. In recent years, wealth has risen for the less wealthy, but they may not feel it. Much of this increase is tied up in illiquid assets like the rising value of home prices and 401(k)s. Many Americans are frustrated that they can’t easily turn these illiquid assets into cash to buy higher priced food, for example.
Erosion of Less Wealthy’s Share — Federal policies that reduce future Social Security (SS) benefits impact the future wealth gap. In February 2024, SS benefits averaged a modest $1,862 per month. In 2022, the share of wealth held by families in the top 10 percent has reached 69 percent while the share of wealth held by families in the bottom 50 percent was only 3 percent, according to the Congressional Budget Office (CBO). If the future SS benefits are not paid in full, as scheduled under current law, the distribution of family wealth would change. The CBO estimates that without legislative action, the SS trust funds would be exhausted by fiscal year 2034, lowering the percent of benefits paid out. SS wealth represents a higher portion of assets for the less wealthy. By including future income from SS benefits, the bottom 50 percent would hold 6 percent of total wealth.
Dismantling Customer Service — Bloomberg reported that the Social Security Administration (SSA) has investigated the four recent SSA computer system outages, out of ten days. This stopped millions of beneficiaries from accessing their accounts, with callers facing longer wait times, delays in resolving payment issues, and revising personal data for SS benefits.
SS systems and databases have been a key focus of the administration’s Department of Government Efficiency (DOGE) attempts to find significant waste. However, DOGE’s conclusions have not been supported by the data. Cumulatively, over eight years, from 2015 to 2022, it is estimated that SSA made nearly $72 billion in improper payments, which is less than 1 percent of benefits paid, as reported by the Inspector General in 2024.
The Washington Post has reported on these new SSA developments:
- System and service breakdowns – SSA 800 number call hold times were more than 120 minutes or 180 minutes, depending on the time of day, after being reduced to 50 minutes during the previous administration. The new administration couldn’t monitor this customer experience after staff was fired by cost cutting actions.
- Barriers that impede benefit access – The new Administration’s acting SSA Commissioner said the fast start of new restrictions on phone services would probably force millions of beneficiaries into visiting crowded and low staffed field offices to get help, under this urgent time frame, even though this kind of change would usually take two years instead of two weeks.
- Rushed and poorly planned changes that put beneficiaries at risk of being defrauded - The quick change in SSA to restrict alternatives for identity verification resulted in confusion, that would actually create new ways for fraud by scammers to steal their identities.
- DOGE is thinking about rushing systems modernization by taking unneeded risks – DOGE is planning a potentially rushed effort to upgrade the SSA computer system which could put benefits for 70 million Americans at risk. DOGE plans to use AI (artificial intelligence) to translate the old COBOL coding into a newer language within months, when a similar COBOL project was expected to take two years.
- Threats to the security of personal data – A court order ruled that DOGE had been improperly given access to sensitive data and should be stopped from direct access justification. In response, the Administration took actions to strengthen DOGE access to the data by making a DOGE member the chief information officer, with responsibility for SSA’s information systems security.
- DOGE effort fails to identify the fraud they falsely claimed was rampant – It was only able to identify about 200 situations where improper collections were made in the name of a dead person, and it was not necessarily due to fraud. So, if all this chaos doesn’t help SS retirees or reduce unsubstantiated fraud, why do it? Some experts say it’s to justify the privatization of SSA, reducing the SS Trust Fund faster.
Save Your Personal SS Data — In case SSA loses your data, take action yourself to copy the most recent data, that accurately proves that you qualified for SS and the benefit amount. Using your secure device, go to your on-line Social Security account. You may need to update your password. Once in your account, copy your earning history, SS payroll tax contributions, SS benefit payment history, your benefit verification letter, SS Statement, and profile. Be patient, because the computer system may not be available. Let others know they need to copy their data, too.
State of Michigan Investment Board (SMIB) — The SMIB met April 2, 2025, for the Quarterly Investment Review which highlighted the Defined Contribution plan and Fixed Equity investments. During the public comment about 24 people testified including teachers, a psycho therapist, social workers, academics, and religious leaders. Some were also State employee retirees and public school retirees, that opposed the use of their state pension funds for the genocide of Gaza civilians, with a 50,000-death toll. At previous SMIB meetings, they asked the board to 1) divest from the $10 million in Israeli bonds; 2) stop renewing these Israeli bonds expiring this November; and 3) provide a statement of commitment not to invest in Israeli bonds until there is positive change. These advocates said that this was the third time they have testified before the SMIB without getting a response.
Editor’s note: Joanne Bump serves as feature columnist for “Retirement Matters.” Column content is time sensitive and is based on information as of 4/6/25. Joanne can be contacted by e-mail at joannebump@gmail.com.
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