Portrait of Progressive Senior Man Sitting in His Living Room Easily Uses Smartphone

It is virtually impossible to function in the modern world without a computer or cell phone and broadband. But paying the monthly cell or cable bill can be a stretch for low-income workers and retirees. Congress recognized the importance of having access to the Internet during COVID’s months-long isolation, passing a $1.4 billion program to subsidize broadband. That program, which is run by the FCC, is running out of money. But a more modest federal program in existence since the 1980s, Lifeline, is still in operation. Lifeline subsidizes up to $9.25 per month for cell or Internet service. This is one-third the size of the COVID subsidy that’s expiring. But every little bit helps. Three groups are eligible. Workers and…

Photo of a Black family visiting their parents

The stark difference in Black and White workers’ wealth is old news. But now we have some fresh information about the wealth gap: it grows as people age and move through their retirement years. The most striking deterioration in Blacks’ relative standing can be seen in non-housing wealth. This mainly consists of 401(k)-style plans and savings and investment accounts and does not include the wealth inherent in retirees’ Social Security or employer pensions. Owning a house is another form of wealth. The White homeownership rate is consistently above 80 percent until retirees reach their advanced years. The Black homeownership rate ranges from 60 to 70 percent for older workers and retirees, and since Black workers tend to buy less expensiv…

Medigap and the One-Way-Street Problem

If a 65-year-old signs up for a Medigap policy but decides a year or two later that the premiums are too high, the new retiree can easily switch to an Advantage policy with a low premium. But if, after starting retirement with Advantage, he wants to switch to a more flexible Medigap policy, he could run into problems. A federal rule requires insurance companies that sell Medigap to accept all 65-year-olds – but only when they are new to Medicare. No rejecting new retirees for pre-existing conditions. No charging a higher premium because they are sicker. But once that initial period lapses, Medigap insurers can reject applicants for all kinds of health reasons. This one-way street “detracts from the ability…

May 14, 2024

Retirement is Filled with Surprises – Good and Bad

In a new survey asking retirees what surprised them about being retired, the big winner – for 43 percent – was how much they’re enjoying it. The rest of the survey indicates that the freedom that comes with leaving the labor force often serves to leaven the considerable sacrifices some have to make for financial reasons. One in four retired households, for example, agree they are “forced to live more frugally than we wanted,” and one in 10 said they’re “spending their nest egg too fast,” according to the survey, fielded in 2023 by Hearts & Wallets, which provides data to the financial industry. I also suspect that one pleasant surprise – having more income than when they were working…

May 9, 2024

Late-career Injuries Come at a Steep Cost

About one in four workers in their 50s and early 60s has a physical or medical condition that limits their ability to work. These impairments can upend retirement plans and force them to make financial sacrifices if they have to apply for disability or sign up early for Social Security. A new research study that looks at four types of injuries – on- versus off-the-job and chronic versus less severe – confirms that they have a dramatic impact on older workers’ earnings and career paths. Start with whether they can continue to work. Older workers who develop an impairment often leave their jobs immediately, regardless of the nature of the impairment, according to the study, which focused on people who…

May 7, 2024

Four Caregiver Types: Do Any of These Look Familiar?

Aaron Blight and his wife were thrown into the role of caregiver when his mother-in-law was diagnosed with a brain tumor. The couple cared for her for more than five years, juggling her needs with raising their four children. Today, Blight combines a professorship at Shenandoah University in Winchester, Virginia, and writing about caregiving with running his company, Caregiving Kinetics, which provides training for professional and family caregivers.  In a recent interview, he discussed four different types of caregivers, whom he describes as “the unheralded and unrecognized” providers of unpaid care valued at some $500 billion per year. He credits Amanda Cooper at the University of Connecticut for the profiles, which she based on the online narratives written by family…

May 2, 2024

America’s Children: How Federal Programs Slash Poverty

About 11 percent of the children in poor families are living with adults who receive Social Security’s retirement, disability, or supplemental cash benefits. The children are often Black or Hispanic. One out of every four of the families has income below $35,000, and many of the children live with a retired grandparent. If the child does live with a parent, it is often a single mother. While these families rely heavily on their income from Social Security, several federal programs provide additional assistance. A new study documents a dramatic drop in the Supplemental Poverty Rate – from 25 percent to 13 percent – for these vulnerable families when the benefits from three major programs are added to their Social Security:…

April 30, 2024

New Retirees: Avoid Costly Medicare Sign-up Mistakes

To retire is to enter the unknown. Rick Fine has demystified one aspect of retirement: Medicare. As the director of financial planning for an advisory and investment firm, he has put together a list of what he sees as the five biggest mistakes new retirees make. I encourage you to read Fine’s well-written and detailed article about his five mistakes. Here are a few of the high points. Mistake #1: Thinking Medicare is free. It’s a great program but it will cost you $174.70 a month for Medicare’s Part B premium – and much more if you have high income. The Part A hospital coverage and Part B for physician services also have deductibles, as do some of the insuranc…

April 25, 2024

Why are Consumers So Glum? Inflation and High Rates

The recession that economists predicted has never materialized. Unemployment has been under 4 percent for more than two years, a low more characteristic of the go-go 1960s than modern times. But inflation began to ease up last year and remains well below the pandemic’s 9 percent peak, despite March’s unwelcome increase of 3.5 percent annually. So how to explain consumers’ sour mood? What else might be missing from our understanding of what is driving their views of the economy. A new study has an answer: high interest rates. The researchers make the case that consumer sentiment reflects not just inflation but also the current high interest rates on car loans, mortgages and credit cards that followed the Federal Reserve’s attempt…

April 23, 2024

Lack of Broadband Impedes Native American Access to Aid

During the pandemic, the U.S. Social Security Administration leaned into providing more services and processing applications online. But that has furthered the agency’s disconnect with Native Americans living miles from its field offices in rural areas with poor internet access. That’s one conclusion from a new study of the agency’s effectiveness in reaching Native American and Alaskan Native populations. The study included some analysis of data on these communities but was based largely on interviews with tribal leaders, community members, advocates, and the government staff who assist people applying for Social Security and other government benefits. Although tribal communities have a higher poverty rate than non-Native populations, their members are somewhat less likely to be receiving Social Security’s various benefits,…

April 18, 2024

What’s Stopping People from Applying for Disability

When people aren’t getting a government benefit they’re eligible for, the program’s goal of improving equity is compromised. Social Security’s disability insurance is an example. Roughly half of the 20 million adults who have a disability that limits or completely prohibits them from working are receiving the benefit. Not all of them would meet the program’s criteria for eligibility. But research based on a survey of workers and interviews with people with disabilities reveals some of the reasons they decide to not even try to apply. An analysis of the survey data shows that the decision is, to a large extent, a matter of having certain advantages. The non-applicants were a fairly small group. But they were more educated and…

April 16, 2024

Part D Plans Ramp up Restrictions on Medications

The Inflation Reduction Act signed by President Biden in 2022 somewhat limits how much retirees will pay out of their own pockets for medications this year. Next year, the law imposes a hard cap of $2,000. But while retirees are getting a reprieve from Congress, insurance companies are pushing in the opposite direction. According to research appearing in Health Affairs, insurers are tightening retirees’ access to some medications and increasing the number that are excluded from Part D and Medicare Advantage plan coverage altogether. Ultimately, this might either cost retirees more or, in the most extreme cases, prevent them from taking some necessary medications if they can’t afford to pay the cost themselves. The $2,000 annual cap on out-of-pocket drug…

April 11, 2024