[ad_1]
The gap between the rich and the poor in the U.S. continues to widen.
The gap in retirement-account balances between middle- and high-income older households more than doubled from 2007 to 2019, according to a recent report from the U.S. Government Accountability Office. The report looked at households of workers age 51 to 64.
While the median account balance for high-income older households nearly doubled to $605,000 from $333,000 over that time, the median account balance for middle-income older households stagnated at about $64,300, the report said.
The report, titled “Retirement Account Disparities Have Increased by Income and Persisted by Race Over Time,” also highlighted the portion of Americans who lack any retirement savings at all.
As of 2019, nine out of 10 of the lowest-income older households had no savings in a retirement account. In fact, the share of the lowest-income households with any retirement-account balance actually decreased, dropping to about 10% in 2019 from 21% in 2007.
The GAO report was commissioned by Sens. Bernie Sanders, a Vermont independent, and Sheldon Whitehouse, a Rhode Island Democrat, amid concerns that federal tax incentives for workers to save money in tax-preferred retirement accounts are mostly benefiting higher-income workers and are doing little to help lower-income workers save for retirement.
“In America today, 55% of seniors are trying to survive on less than $25,000 a year. Given that reality, our job is to make sure that the working class in our country are able to retire with the dignity and the respect that they deserve,” Sanders said in a statement.
“After a lifetime of work, all Americans should be able to retire with dignity,” Whitehouse said. “But today, millions of Americans are retiring with no savings. Our rigged tax code is subsidizing the retirement of billionaires and leaving everyone else to foot the bill. As a result, wealthy households have nine times more saved than the average middle-class household, and just 10% of the lowest-income families have anything saved at all.”
Racial disparities have also persisted, the report found.
In 2019, about 63% of white households had a retirement-account balance, compared with about 41% of households of all other races. And among households that had retirement savings in 2019, white households had double the median balance of all other races — $164,000 versus $80,300, respectively.
The report also looked at access to workplace retirement accounts and found significantly lower access among low-income households. High-income older households were more than three times as likely to have access to workplace retirement accounts as low-income older households — at about 75% to 23%, respectively.
[ad_2]
Source link
