An Income Gap Is Jeopardizing Retirement for Millions of Americans

Getting by in America can be difficult these days for many middle-class people — especially older Americans who find themselves toward the lower end of the income bracket.

Paula Span’s column, The New Old Age, addresses a broad spectrum of issues related to aging, and it appears twice a month in The New York Times. She wrote recently about the income gap that jeopardizes retirement for millions of Americans.

Her column looked at new research, published in the journal Health Affairs, that found a “bifurcation” among Americans nearing retirement, with essentially two middle classes — an upper tier, with an average of more than $90,000 in annual resources, including income, home equity or retirement savings; and a lower tier, averaging less than $32,000 a year.

The lower tier has been steadily losing ground financially over the past two decades. For example, homeownership declined by 5 percent among the upper middle class from 1994 to 2018, compared with a 31 percent drop among the lower middle class. For people who were working, earnings rose 27 percent in the upper tier but fell 5 percent in the lower tier, adjusted for inflation.

Those losses portend an insecure retirement, and they have disturbing implications for health and life expectancy. Lower-middle-class seniors were far less likely to have employer-provided health insurance than those in the upper middle class, and they reported more chronic health conditions as well.

“There’s a lot of attention paid to the inequities between the very bottom and the top of income distribution,” Jack Chapel, the lead author of the new study and an economist and doctoral candidate at the University of Southern California, told Paula. “We wanted to look at the middle class, where people are struggling.”

Paula wrote about Monique Louvigny, a 64-year-old event coordinator in the Bay Area who was laid off at 57, an age when it can be difficult to find another job. She’s now a freelancer and cuts expenses where she can: She drives a 10-year-old Prius, has a housemate who pays rent in her condo in Vallejo and visits a food pantry once a month.

Things are precarious. Louvigny’s careful efforts to economize have “demonstrated how fragile a lower-middle-class life has become,” Paula told me. “It’s way too easy to slide into poverty.”

Tell us

The closure of Pea Soup Andersen’s, one of California’s most iconic roadside restaurants, has left loyal fans upset.

The public dismay made us wonder which other roadside attractions hold a tender place in the hearts of Californians. What billboards, restaurants or shops do you always visit — or just notice — when you’re on road trips in the Golden State? What do these landmarks mean to you?

Email us at [email protected] with your stories and memories. Please include your full name and the city in which you live.

And before you go, some good news

Avery Fisher, a resident of Marin County, set the Guinness World Record in November for the most magic tricks performed underwater in three minutes, according to Guinness World Records.

Fisher, 13, who lives in Tiburon, claimed the record during a dive at the Aquarium of the Bay in San Francisco, where she completed 38 illusions in three minutes, surpassing a previous record of 20 tricks held by Martin Rees, a professional magician.

Fisher’s journey to becoming a scuba magician began during the pandemic when, at age 10, she took an interest in diving and began studying for a certificate. By 12, Fisher was certified as a professional grade scuba diver and had earned the title of world’s youngest scuba magician, which is a recognized diving specialty.

Fisher, according to Guinness World Records, is passionate about marine conservation and ocean stewardship and hopes to raise awareness about them.