New York’s middle class is struggling to afford basic necessities as retirement is becoming an illusion for them. That's the finding of an AARP-commissioned Siena College poll.
Times are tough for so-called "Baby Boomers," age 52 to 70, and the next generation down, Gen Xers, roughly age 36 to 51. A new statewide Siena College telephone survey "Countdown: New York’s Vanishing Middle Class" is loaded with sobering numbers.
Don Levy is Director of the Siena College Research Institute. "When we asked them 'do you think that it's a problem people saving enough for retirement?' 89 percent of Xers 90 percent of boomers say that, yeah, they think its definitely a significant problem, people saving enough for retirement. So then we delved into just a little bit of how are they doing financially today. And there we got a little bit concerned. About half, slightly more than half of Generation Xers, just fewer than half of Baby Boomers, say that they are just getting by financially today at best. Fewer than half of Xers, just over half of Boomers, say that they are living comfortably. So about half of us are saying, 'You know what? I'm just getting by, I'm just making my ends meet.' So it seems to be no wonder that so many of them tell us that they're worried. That they often worry. Nearly two-thirds of Xers, just fewer than that, 59 percent of boomers tell us that they worry either often or very often about having enough money to retire at the age that they choose and at the style that they expect."
Levy adds pollsters weren't surprised by the harsh reality. The survey demonstrates that New York’s middle class is struggling to afford basic necessities as retirement becomes an illusion, with Generation Xers even worse off than Baby Boomers. Survey participants were asked which everyday expenses were seriously impacting them financially. "The number one cost that was affecting both Xers and boomers at the greatest rate was housing. Over half of Xers, 55 percent, and nearly half of Boomers, 49 percent, said that housing costs are posing them a very serious financial impact."
Putting food on the shelves and paying utility bills were also of great concern. The poll also uncovered a so-called “trust gap,” with Gen Xers far less confident than Boomers that they’ll have the means or receive promised benefits to live comfortably in retirement. 48 percent of middle-class Gen Xers say they don’t plan to live in New York at all in retirement.
The survey finds that while struggling to make ends meet, respondents aren't putting enough money away for retirement. Nine out of 10 Gen Xers and Boomers say it is a problem for them to save. Beth Finkel is State Director of AARP in New York: "Building a financial nest egg is becoming harder, but we can ease the middle class squeeze if our elected leaders restore trust by helping New Yorkers help themselves save and by safeguarding the future benefits they’ve earned."
More than 55 percent of those polled think Democratic presidential nominee Hillary Clinton would do a better job than Republican nominee Donald Trump protecting Social Security and addressing seniors' retirement needs.
Finkel says AARP has some valuable retirement planning tools online — here's a link — and there's one more fly in the retirement ointment. "The average cost currently in New York per month, out of pocket healthcare cost, when you retire, is $476 a month. So that is above and beyond your basic Medicare, and most people are totally unaware of that, and that's what the research showed us. They're unaware of it and they're totally unprepared for it. As a matter of fact, if you live in a household of two people, that's gonna be close to a thousand dollars a month coming out of your after-tax retirement dollars."
In May 2015 AARP released the results of a similar survey, reported in the Times Union. It too showed that Boomers and Gen Xers were saving too little cash to retire. At the time, 38 percent of boomers had no retirement savings, pension or 401 (k). 30 percent of Generation Xers were in the same situation. According to The National Institute on Retirement Security, retiree spending of pension benefits is critical to the U.S. economy.
The Siena survey of 806 New Yorkers age 35 to 70 was conducted by telephone between July 25 through August 16.
