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The AARP Public Policy Institute focuses on issues of critical importance as we age. Below we highlight research, analysis, background and commentary on Middle Class Security.

Recent Analysis

The Effect of a Universal Automatic IRA With Emergency Savings on Household Wealth

This report models the effects of an Automatic Individual Retirement Account (Auto IRA), a simple retirement savings program that is currently in use in several states, along with a feature for emergency savings. Read.

US Small Business Employment and Older Workers

This paper provides details on older workers’ prominent position in what remains a key driver of the labor force and overall economy: small businesses. Read

Payroll Deduction Retirement Programs Build Economic Security

Access to an employer-based retirement plan is critical for building financial security later in life, yet nearly half of American employees in the private sector work for an employer that does not offer either a traditional pension or a retirement savings plan. This figure has not changed much in decades, but the growing number of state-facilitated, privately managed retirement savings programs are helping to close this gap. Read

Employment Data Digest

The latest monthly digest of employment data from the Bureau of Labor Statistics (BLS) examines the findings from the Employment Situation Report. It takes a closer look at employment data for people ages 55 and over, including labor force participation, employment rates, and duration of unemployment. Read

From Short-Term Financial Well-Being to Long-Term Financial Security

This paper examines how financial well-being (FWB) evolves over time, what factors and behaviors are most predictive of large increases or decreases in FWB, and whether these relationships may have changed following the onset of the COVID-19 pandemic. Read

The Changing Picture of Who Claims Social Security Early

As individuals approach their 60s, they face the important decision about when to start claiming Social Security retirement benefits. This report examines the characteristics of those who decide to start collecting at the early eligibility age of 62 compared with those who wait until later. Read

The Consequences of Claiming Social Security Benefits at Age 62

This paper by Philip Armour and David Knapp of the RAND Corporation asks what financial consequences the decision to collect Social Security early might have for the individual over time. Read

The U.S. Essential Workforce Ages 50 and Older: A Snapshot

During the early stages of the COVID-19 crisis, as businesses either closed or moved employees to telework, the vital importance of a segment of the overall working population, the essential workforce, came to light for Americans. These workers perform jobs that are necessary to critical infrastructure operations. Read

Financial Access Challenges for Older Adults

Nearly 15 million households 50 and older face gaps in financial access that increase both their costs and risk. This fact sheet examines these gaps, including findings on bank account ownership, account access methods, and credit activity. Read

Facilitating Workplace Emergency Savings Programs Through Payroll Cards

There are many ways to structure workplace savings programs, but this report looks at a model that includes four key elements to ensure widespread employer adoption and employee participation: 1) automatic enrollment, 2) consumer-friendly features, 3) regulatory feasibility and 4) affordability for employers. Read

How Does Earnings Inequality Affect Social Security Financing?

Earnings inequality accounts for a considerable portion of Social Security’s fiscal challenges. This report found that if 90 percent of earnings had been subject to Social Security payroll taxes since 1983 the system’s long-term financing gap would be 25 percent lower today and the life of the combined trust funds would last an additional four years above current Social Security projections.  Read

Making the Earned Income Tax Credit Work for Workers Ages 65 and Older

It's time to bring the Earned Income Tax Credit (EITC) into the 21st century by removing its age ceiling. Today’s policy makers looking for ways to improve retirement security and incentivize older workers to remain in the workforce, can start by updating this outdated policy that excludes most low-income workers ages 65 and older from one of the nation’s backbone income-support programs simply by virtue of their age. Read

Unlocking the Potential of Emergency Savings Accounts

Despite the United States being in the midst of a prolonged period of economic growth and record-low unemployment, a large share of Americans remain just one surprise event away from financial distress. This report focuses on emergency savings accounts as one potential solution to short-term financial fragility. Read

Achieving Economies of Scale in State-Facilitated Retirement Savings Programs: The Case for Multi-State Collaboration

States have considered creating individual retirement savings programs that would serve only their own citizens. However, states should explore other models — ones based on a multi-state or regional approach that would enable participating states to provide even better services to their citizens. Read

A The Role of Employer Repayment Programs in Tackling Student Loan Debt

In 2019, total student loan debt in the United States equaled $1.5 trillion, a more than five-fold increase from 2003 levels. The average college senior who took on student loans now graduates with over $29,000 in debt. Read

A Look at College Costs across Generations

College costs have risen dramatically over the past several decades. This report compares college costs from 1964-1965 up through the present day, and examines how higher costs—and increased borrowing—may affect young workers’ future retirement security. Read

The Student Loan Debt Threat: An Intergenerational Problem 

Student loan debt is an intergenerational problem, burdening borrowers of all ages and threatening the long-term financial security of millions of families. This paper examines the landscape of student loan debt with a focus on older borrowers, including increasing loan balances, defaults, taking on debt to help family members, and the implication for long-term financial security. Read

Defraying High Out-of-Pocket Health Care Costs: The Medical Expense Tax Deduction

The medical expense tax deduction helps millions of middle-income taxpayers of all ages confront high out-of-pocket health care costs. The fact sheet presents national and state estimates of extending recently expired temporary changes, adopted under the Tax Cuts and Jobs Act of 2017. Read

Saving at Work for a Rainy Day: Perspectives from Employees

Today, a significant share of American households lack the financial resources to weather a modest financial setback. According to the Federal Reserve, four in ten American households could not come up with $400 in a financial emergency. This lack of liquid savings puts their short-term and long-term financial wellness at risk. Read

An Aging Labor Force and the Challenges of 65+ Jobseekers

Although the labor force participation rate of older workers is growing, jobseekers ages 65 and older face many challenges in their search for work. Compared with younger jobseekers, they experience longer durations of unemployment, and many encounter age discrimination. They are also more likely to be reentering the labor market after time spent away, or to be rebuilding their career after a layoff. Read

Older Workers and Part-Time Employment

Workers ages 50 and older are more likely to work part time compared with their younger counterparts. This Fact Sheet examines current trends in part time work, including demographic differences and compares reasons for working part time in different age groups. Read

Seniors with High Unreimbursed Health Care Costs: Who Are They?

In 2013, roughly 25.8 million traditional Medicare beneficiaries spent at least 10 percent of their income on out-of-pocket health care expenses. The medical expense tax deduction makes health care more affordable for people with significant out-of-pocket expenses. This factsheet presents some of the key socio-economic and health characteristics of Medicare beneficiaries who bear such a high health care cost burden and for whom the medical expense tax deduction is critical. Read

Medical Expense Tax Deduction: Key Characteristics by State

Today taxpayers with high out-of-pocket medical expenses may be able to deduct a portion of their costs from their taxable income. In 2015, 8.8 million taxpayers relied on this tax provision, deducting $86.9 billion.1 Between 2016 and 2020, the deduction is estimated to reduce the tax bill of these taxpayers by a total of $56.6 billion. Read

Protecting Consumers during the Telephone Network Modernization

Many older adults continue to rely on the traditional copper wire landline phone networks. However, many telephone companies are now switching to fiber networks using Internet Protocol services, or to fixed wireless service. This transition raises important consumer concerns about issues such as reliability, service quality, and cost. Read

The Fight to Eliminate Unwanted Robocalls

Unwanted telemarketing calls are consistently the biggest source of consumer complaints received by the Federal Communications Commission (FCC). Of particular concern are prerecorded calls —better known as ‘robocalls’. Read

The Importance of an Open Internet to Older Americans

Maintaining an open Internet is central to keeping making sure older adults benefit from all the Internet has to offer. Without the open Internet consumers could face reduced Internet access, higher costs, and miss out on innovative products and services that could benefit older Americans. Read

Improving the Saver’s Credit for Low- and Moderate-Income Workers

This report reviews the existing structure of the Saver’s Credit and proposes several ways to make it more effective. It also discusses retirement plan coverage for low- to moderate-income workers and considers a number of ways to improve both the effectiveness and the utilization of the credit. Read

Liquid Savings of Working Households Ages 50-64

Millions of households have little to no liquid savings to cushion them from the unexpected. While liquid savings levels increase with age and income, a third of pre-retirees have less than $2,000 in liquid savings, which is the cost of a typical worst-case financial shock. Read

Fiscal Savings to States of Helping People Save More for Their Own Retirement

When individuals save for retirement they are less likely to rely on public assistance programs later in life. These fact sheets show the fiscal savings to state governments that could result from lower-income retirees having saved through Work and Save programs during their working years. Read

Access to Workplace Retirement Plans by Race and Ethnicity

Workers are 15 times more likely to save for retirement if they have access to a payroll deduction savings plan at work. Yet nearly half of American private-sector employees—roughly 55 million—work for an employer that does not offer a retirement plan. Black, Asian, and Hispanic employees are less likely than White employees to be covered by a plan. They also strongly support efforts by states to create retirement savings programs for small-business employees whose employer does not already offer a plan. Read

Disrupting Aging in the Workplace: Profiles in Intergenerational Diversity Leadership

The AARP Public Policy Institute conducted a series of case studies of leading employers to examine programs and practices that address age diversity and the intergenerational workforce. Five companies from a variety of industries and of different sizes were selected for inclusion in the study: Huntington Ingalls Industries, UnitedHealth Group, Centrica, PNC, and AT&T. Interviews were conducted in February and March 2016 with human resources staff, diversity officers, and program managers. Read

Guaranteed Returns in Retirement Savings Plans: Are They Worth the Cost?

This report discusses investment guarantees that promise to deliver at least a certain level of return.  It also covers both the costs of such guarantees and their potential value to savers. Read

Preventing Exploitation: Five Banks Leading the Fight

In an effort to protect consumers and fight exploitation, AARP is spotlighting promising practices of financial institutions around the world. Read

Making State Retirement Plans Work for Private Employers: Including Lifetime Income Options

A state-sponsored retirement savings plan could help millions of private-sector workers who are not covered by an employer plan build financial security. Read

What Types of Costs Would a State-Sponsored Retirement Savings Plan Impose on Employers: A Case Study Using the Illinois Secure Choice Savings Program

A state-sponsored retirement savings plan could help millions of private-sector workers who are not covered by an employer plan build financial security. Read

Family Financial Caregiving: Rewards, Stresses, and Responsibilities

This Insight on the Issues explores the experiences of a group of unpaid family financial caregivers to examine the challenges they face. Read

Testimony before the Oregon Retirement Savings Task Force

How to structure an effort to improve retirement savings opportunities for private sector employees.  Read

The Employment Situation, June 2014

The unemployment rate for older workers falls to 4.4%. Other indicators are improving as well. Read

The Case for Automatic Enrollment in Individual Retirement Accounts 

This In Brief by PPI’s Gary Koenig summarizes key findings on the economic impact of the Auto IRA and its potential to bolster retirement security. Read

The Population of Workers Covered by the Auto IRA: Trends and Characteristics 

This report by Benjamin H. Harris and Ilana Fischer of the Brookings Institution shows the Auto IRA would extend a workplace retirement savings plan to roughly one-quarter of the U.S. workforce. Most of the workers covered under the Auto IRA would be full-time employees and more than 80 percent have earnings less than $50,000. Read

Economic Effects of Automatic Enrollment in Individual Retirement Accounts

This report by Benjamin H. Harris of the Brookings Institution and Rachel M. Johnson of the Urban Institute illustrates the enormous impact the Auto IRA proposal could have on retirement savings and security. Average contributions to IRAs for those benefiting under the proposal would increase  and an estimated 5 percent to 15 percent of taxpayers would receive a tax cut, with those in the middle-income groups benefiting most. Read


Susan Reinhard is senior vice president and director of AARP Public Policy Institute. Read her latest blogs on family caregiving, healthy living, nursing and more. Read Susan's Blogs

Middle Class Security Project

About the Project 

The AARP Public Policy Institute (PPI) conducted a year-long, multidisciplinary exploration of the well-being of America’s middle class with a focus on prospects for financially secure retirement. The Middle ClassSecurity Project offers insight, analysis and an agenda for policymakers to consider. The following reports provide findings from this project.

Uphill Climb for Women Seeking Retirement Security

Women live longer than men, have lower earnings, and are more likely to outlive some sources of retirement income.  Read

Building Lifetime Middle-Class Security

Major findings and policy recommendations from the Middle-Class Security Project. Read

New Ways to Promote Retirement Saving

Leading experts propose public and private sector reforms designed to help boost saving among low- and middle-income households.  Read

Sources of Income for Older Americans, 2012

Social Security remains the mainstay of retirement income for most older Americans. Read

Retirement Prospects of Middle-Class Americans

Many younger Americans will find it harder than their parents to maintain the living standards of their working years when they retire. Read

Income and Poverty Among Older Americans

Many older Americans continue to suffer financial setbacks from the Great Recession. Read

The Middle-Class Balance Sheet 1989-2010

Gains in net worth have been offset by rising debt, threatening long-term financial security. Read

Tracking the Decline: Middle-Class Security in the 2000s

A new tracking index shows declining security for working-age middle-income families. Read

What Has Happened to Middle-Class Income?

Median income in 2011 was lower than it was in 1997. A look at what happened and why. Read

Older Americans and Credit Card Debt

A troubling picture of credit card debt near or in retirement. Read

The Impact of Rising Healthcare Costs

Rising health care costs are jeopardizing the health and financial security of middle-class families. Read

Loss of Housing Affordability

Housing costs threaten financial stability for many middle-class older adults. Read

Dealing with New Economic Realities

Older Americans in Philadelphia, Milwaukee and Tampa discuss their financial difficulties. Read

Blog Posts