America is facing a retirement crisis with nearly half of households with members aged 55-64 having no savings at all. Census data shows that roughly 52 percent of Americans 65 and older live on less than $30,000 annually, with one in four surviving on less than $15,000 per year. Additionally, nearly 17 million older Americans are financially insecure, with more than 10 percent living in poverty.
The shift from defined benefit to defined contribution retirement plans has contributed to wealth inequality in the United States. The number of workers participating in defined contribution plans has increased significantly since 1975, while the number in defined benefit plans has decreased. This shift has put more Americans at risk of not being able to maintain their standard of living in old age.
Despite the grim numbers, some experts deny the existence of a retirement income crisis. Andrew Biggs, a senior fellow with the American Enterprise Institute, is one of them, using misleading data to argue against the crisis. However, the Federal Reserve data shows that only 9 percent of Americans aged 55-64 own a business or real estate that could generate income in retirement, with the bulk of these assets owned by the wealthiest individuals.
Republicans are pushing to cut Social Security and Medicare, further jeopardizing the financial security of older Americans. The proposal to raise the full Social Security age even higher could worsen the already high elder poverty rates in the country. The U.S. has the highest elder poverty rate among the world’s wealthiest nations, and the rate has remained stubbornly steady at around 10 percent over the past 30 years.
Senator Bernie Sanders emphasizes the importance of addressing the retirement crisis to ensure a secure and dignified future for America’s growing elderly population. Sanders’ point is straightforward – the U.S. has high elder poverty rates that won’t improve without action from Congress. By acknowledging the crisis and working towards solutions, we can create a more secure future for older Americans who have worked hard throughout their lives.
