Ann Pircio Pardes, a 62-year-old director of early childhood education at a religious institution in Westchester County, New York, is contemplating retirement within the next five years. However, with a family history of longevity, she fears depleting her savings and seeks an accurate projection of her retirement income. As a single woman, she also expresses concerns about long-term care and its associated costs. To address these worries, financial advisor Margarita Perry from RBC Wealth Management conducted a detailed analysis of Pardes' financial situation, considering various scenarios to ensure her financial security during retirement.
Perry began by evaluating Pardes' assets and liabilities. Her primary resources include $300,000 in a 403(b) retirement account, an $88,000 annuity, approximately $150,000 in cash, and a $350,000 mortgage as her sole debt. Pardes spends around $4,600 monthly from her $6,500 take-home pay, saving most of the remainder for future expenses, including a dream trip to Africa. Her Social Security benefits could reach $3,600 per month if claimed at age 67 or exceed $4,000 if deferred until 70.
Perry explored several possibilities with Pardes. One option involved selling her home and renting instead of maintaining her mortgage. Another considered when she might require a new vehicle, though Pardes plans to continue using her current car for as long as possible. Perry also discussed the potential benefits of part-time work post-retirement, which Pardes welcomed, envisioning herself teaching in some capacity.
Given the uncertainties of investment performance, health, and personal aspirations over three decades, planners utilize software to simulate outcomes under different conditions. For instance, what would happen if Pardes sold her house? Delayed Social Security benefits? Engaged in part-time employment? The software assesses the likelihood of her plan succeeding—defined as not exhausting her funds—across numerous hypothetical investment returns. Perry considers a success rate of at least 75 percent acceptable.
Among the four scenarios Perry examined, one had Pardes retiring at 67, claiming Social Security immediately, working part-time until 70, and selling her home. Without long-term care insurance, this scenario yielded only a 56 percent chance of success should she require such care. The final scenario Perry presented included retiring at 67, working part-time, selling her house, delaying Social Security until 70, and purchasing a long-term care policy. This approach resulted in a 73 percent success rate, sufficiently close to Perry's target to recommend it.
In all scenarios, Perry adjusted Pardes' portfolio to allocate approximately 60 percent to stocks and allocated more funds toward her travel aspirations. "You're young!" Perry emphasized, encouraging Pardes to enjoy life while securing her financial future.
A groundbreaking collaboration between Mastercard and MoneyGram has introduced a new era of digital money movement. By integrating Mastercard Move, a suite of advanced money transfer solutions, MoneyGram now offers customers the ability to send funds domestically and internationally with unprecedented ease. This integration enables U.S.-issued Mastercard holders to transfer money to 38 global markets and access billions of endpoints worldwide. The partnership aims to expand its reach throughout the year, enhancing MoneyGram's mission to deliver seamless, affordable, and secure cross-border payments.
The alliance leverages MoneyGram’s extensive global network, present in nearly every country, combined with Mastercard’s cutting-edge technology. Customers can now enjoy near real-time funding, cross-border transfers to various destinations such as bank accounts, mobile wallets, and cash pickup points. Additionally, they benefit from reduced transaction fees and increased security through both companies' robust networks.
This development underscores the growing importance of efficient and secure payment systems in fostering digital economy participation. Chiro Aikat, co-president of Mastercard's United States division, emphasized the significance of this integration in providing speed and reliability in transactions, ensuring funds reach their intended recipients promptly.
In recent months, Mastercard Move has seen significant growth, with transactions increasing by 40% year-over-year in the fourth quarter. Furthermore, Mastercard has extended its money transfer capabilities through Jack Henry’s Rapid Transfers service, enabling near real-time money movement. Alan Marquard, head of transfer solutions at Mastercard, highlighted the company's vision for Mastercard Move as a comprehensive platform catering to diverse needs like payroll, gaming payments, and B2B transactions.
This strategic partnership marks a pivotal step toward transforming the landscape of global payments. By combining resources and expertise, Mastercard and MoneyGram are paving the way for a future where cross-border transactions are not only faster and more secure but also accessible to everyone, regardless of location or financial status. Their commitment to innovation ensures that individuals and businesses alike can thrive in an increasingly interconnected world.
A recent report reveals that cuts to the Internal Revenue Service's workforce could lead to significant financial losses for the federal government. The Trump administration's decision to reduce IRS positions aims at budget savings but may result in decreased tax revenue collection due to reduced auditing and compliance activities. Economists argue that these cuts will not only affect immediate fiscal returns but also exacerbate the long-standing issue of the "tax gap," where wealthy individuals evade substantial amounts of taxes.
Cuts to IRS Workforce May Lead to a $159 Billion Loss Over a Decade
In the heart of an economic debate, a new analysis from Yale University highlights how reductions in IRS staffing levels could cost the U.S. government billions over the next decade. With plans to eliminate approximately 18,200 IRS jobs by mid-May, the administration anticipates saving $1.4 billion by 2026. However, experts estimate this move will result in $8.3 billion less in tax revenue next year alone, leading to a net loss of about $6.8 billion.
According to Yale researchers, if these staff reductions persist for the next ten years, the cumulative uncollected tax dollars could reach $159 billion. These figures underscore the importance of IRS employees who focus on auditing high-income earners and ensuring compliance with tax laws. Auditors play a crucial role in recovering unpaid taxes, particularly from wealthier Americans, who account for a significant portion of the annual tax gap.
The Department of Government Efficiency’s strategy to cut IRS positions aligns with Republican efforts to minimize audits targeting affluent taxpayers. While some critics argue that increased auditing might burden law-abiding citizens with compliance costs, others see these cuts as part of a broader initiative to lower taxes for the wealthy. This controversy raises questions about balancing audit frequency with taxpayer fairness and efficiency.
From a journalist's perspective, this report underscores the delicate balance between reducing government spending and maintaining effective tax enforcement. Cutting IRS resources may seem like a straightforward solution for saving money, but it risks undermining the agency's ability to collect necessary revenues. As debates continue, policymakers must weigh the potential long-term consequences of such measures against their short-term benefits. Ultimately, finding a middle ground ensures both fiscal responsibility and equitable taxation practices.