Posts Tagged "federal reserve"
April 26, 2022
Workers Stress about Inflation Spike
Regular working folks can always find something about their finances to be stressed about. But today’s stress is coming from a new place: a level of inflation this country hasn’t seen in four decades.
A large majority of workers – 76 percent – identified rising prices as having a negative impact on their finances. And among households earning under $55,000, 84 percent are feeling stretched, according to the financial services website Salaryfinance.com.
Nearly half of the 3,000 workers the firm surveyed in February specifically said that inflation is stressing them out, causing anxiety, depression, or both. They said the inflation makes it tough to afford basic necessities or save money.
The stress is understandable. The consumer price index has risen 8.5 percent over the past year, and the increase isn’t just at the grocery store or the gas pump. A narrower measure of inflation that excludes food and energy is also up sharply – 6.5 percent for the year. Housing, another necessity, is driving up living costs too.
Workers got some protection from price hikes in 2021, because their wages were outpacing prices, according to the Wharton School. But those gains could disappear this year if inflation continues to accelerate.
Consumers are getting some relief from falling gas prices, which have declined for the fourth straight week, according to Gas Buddy. …Learn More
October 22, 2019
Most Data Sets Agree on Retiree Income
What kind of financial shape are retirees in?
A 2017 study refocused attention on this old question, and it has taken on greater urgency as more and more baby boomers retire.
The study looked at the accuracy of the U.S. Census Bureau’s Current Population Survey (CPS) and confirmed earlier research showing that it dramatically under-estimates retirees’ income. The under-reporting in the CPS could raise concerns about the accuracy of other surveys that paint a less-than-rosy picture of retirement life.
To get to the bottom of things, the Center for Retirement Research (CRR) dug into other standard sources of survey data on retired households so they could be compared with CPS data. They found that the income estimates in the CPS were much lower than the others and clearly the outlier – the other four data sets roughly agreed on how much income retirees have.
The CRR researchers then selected one of the reliable sources of income data – the Health and Retirement Study (HRS) – to assess how retirees are faring. They concluded that around half of over-65 households may be experiencing difficulty maintaining the standard of living they enjoyed while they were working. The researchers based this on the rule of thumb that they need about 75 percent of their past employment earnings.
To be sure, every survey has its strengths and shortcomings, because they rely on what people say they are getting from their Social Security, retirement plans, and investments. …Learn More
About Squared Away
Learn more about our blog and its writer, Kimberly Blanton, a former Boston Globe reporter.
