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Lining up at the food bank

By Jennie L. Phipps ·
Wednesday, February 22, 2012
Posted: 8 pm ET

I'm spending the winter in a beach community in Florida. We're on a barrier island, so most of the housing is on or near water, and none of it is bargain priced.

Every day, I walk my dog to the dog park, past a church that has a sign on the side of the building pointing the way to its food bank in the rear. The bank is open two mornings a week. If the yapper and I leave our condo early on Tuesday and Thursday, we invariably see a line of 15 or so people outside the food bank's door. Almost all of them are older; a number of them wait in their motorized wheelchairs.

The first time I saw the lineup, I was shocked. I don't think I'm naive about economic need -- I'm from Detroit. I know many people have it tough. But to see people here in what is clearly the land of plenty who are struggling to the extent that they need to line up for free food appalls me.

The poverty level for people age 60 and older is 9.4 percent, according to a recent analysis of U.S. Census and Labor Department data. Nari Rhee, a researcher with the University of California Berkeley’s Center for Labor Research and Education, who authored the analysis, blames poverty among seniors on inadequate employment -- both current and past.

She says people who didn't have regular employment with a living wage when they were younger don't qualify for pensions, but more importantly, they didn't build up eligibility for sufficient Social Security. Since 22 percent of whites and 30 percent of African-Americans depend on Social Security for 90 percent or more of their income, getting a very small Social Security check means they don't have enough money to live on. When you combine that with the difficulty many people have finding work when they are older than 55, the result is people standing in line at the food bank -- a retirement planning nightmare.

Rhee, who is 41, says people her age and younger tend to ignore retirement issues since they seem so distant. But she thinks that's a big mistake because her analysis of census data suggests that as many as 50 percent of Generation X, ages 30 to 45, are unlikely to be able to retire with enough money to meet basic expenses unless Social Security and pensions are bolstered soon.

"I think people 25 to 45 need to take a long hard look at their futures," she says. "We need to figure out how to fix our retirement systems because if we don't, then how are we going to survive?"

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February 23, 2012 at 4:17 pm

Ray, long term capital gains and dividends are taxed (currently) at 15% rate - here is your incentive to save and invest.
Of course, for each situation is a little different.
Self employed can have SEP, for example.
By the way, if you're over 50 and qualify ROTH IRA is a better choice, in my opinion, as you are not so far away from withdrawals that deferred tax is better than no tax.

February 23, 2012 at 9:16 am

What retirement systems? Most people (myself included) do not have a pension. Those of us that need to "catch up" on our IRA contributions are capped at $5,000/$6000 (over 50). That's not enough. More incentives to save and invest tax free are needed. The bureaucrats in Washington would rather pay favorites with special interests (campaign contributors to both parties) than take care of this problem in a meaningful way.