Are We Facing a Growing Gap Between Rich and Poor Retirees?

Susan Tompor writes in the Detroit Free Press (via the LA Times) today:

The rules of the retirement game just got a sizable overhaul in Congress, giving a nod to the reality that many Americans can’t afford to quit working. The changes aren’t massive enough to put to rest concerns about an upcoming retirement crisis, in which some forecast a growing gap between the haves and have-nots.

Tompor’s article is a nice summary of the new retirement rules, which are indeed mostly a good thing. But is there really an “upcoming retirement crisis?” And although “some” may forecast a growing gap between the haves and the have nots, what do actual projections say about that? The Urban Institute has done several of them based on the MINT retirement model, including distribution estimates for the average retirement income of the middle-class and the affluent as a percentage of the income of the poor:

Surprisingly, not only is the gap between rich and poor retirees not skyrocketing, it’s not even growing. For retirees in 2005, the rich earned about 800 percent of the income of the poor. For retirees in 2062, MINT projects that it’s a little less than 700 percent.

In a different table (A8-12g for those who want to check), you’ll learn that the income of retirees as a percent of the poverty rate is also projected to rise. And the number of seniors under the poverty line is projected to decline.

These are averages, and obviously the retirement income of the poor is nothing to write home about. We should increase Social Security payouts at the bottom of the income ladder to make up for that. However, although you can get different answers about the gap between rich and poor retirees by looking at different projections, the evidence suggests that it will grow by a small amount at most, and probably not all.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

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Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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