Report: After age 50, gap widens between rich, poor in U.S.
WASHINGTON (CNN) -- While most Americans over age 50 are financially better off than their counterparts 20 years ago, the gap between the rich and poor is widening, a new report says.
The American Association of Retired Persons report says only 25 percent of people in their 50s are secure for retirement.
Fifty percent of people over 50 hopefully will "be OK if things go right," said John Rother, AARP director of legislation and policy.
Beyond that, "the group in the bottom 25 percent, people with family incomes under $19,000, are generally in trouble," Rother said. "They do not have savings, do not have pensions, they're not prepared to retire."
According to the report, titled "Beyond Fifty," those in the top quarter have a median income of $100,000, with more than 90 percent of their income from wages, and are more likely to have health insurance. Ninety percent of them are married.
In the lowest quarter, the median income is $10,000, with less than half coming from wages. Sixty percent are unmarried and 60 percent are women, the report said. Minorities make up a larger portion of the bottom half.
While the differences between the top and bottom groups have diminished in some areas, the report said, disparities in the critical areas of income and wealth have increased.
Genevieve Gonzalez, 61, is representative of those in the lower quarter.
A New York City store clerk, she cannot afford to retire. Her health is stable for now, but she has high blood pressure, high cholesterol, heart problems and no health insurance. She earns just $5.15 an hour, though her husband, who is retired, receives about $700 a month from Social Security.
"Sometimes my heart starts beating fast and I say, 'Oh, my God, I am sick,'" she said. "If I get sick I won't be able to make ends meet."
The number of 50- to 64-year-olds without health insurance continues to climb, the AARP said, from 11 percent in 1988 to 14 percent in 2000, and more than two-thirds of those who live in poverty do not receive Medicaid protection. Meanwhile, participation in employer-sponsored pension plans continues to stagnate, prompting Congress to call for reforms.
Fiscal fears through the years also vary among the "beyond 50" crowd.
The study reports that those in their 50s are worried about personal debt -- like putting children through college while paying off the mortgage. Younger retirees are most concerned about caring for an aging parent, while older retirees express concerns about the death of a spouse, which could be emotionally and financially devastating.
"We really need to think about four pillars for retirement." Rother said.
"The first pillar is Social Security. The second is individual pensions or savings. The third is health insurance, very important. And the fourth, surprisingly, is the continued ability to earn, because many people are going to need to find some way of bringing in earnings after they pass normal retirement age, and we think that that should be more and more emphasized in terms of getting ready for that possibility." The AARP is an organization for people age 50 and older.
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