Governor, Lawmakers Failed to Address NY’s Retirement Savings Crisis in 2017
State leaders neglected the retirement saving needs of over 3.5 million working New Yorkers and failed to provide adequate supports for the unpaid family caregivers who help New Yorkers age in their own homes during the just-concluded 2017 New York State legislative session.
Over half of all private sector employees in New York lack access to a way to save at work, including 67% of Hispanics. Workers are 15 times likelier to save if they can do so on the job. Yet the legislature did not take up any bills to address the problem.
“Governor Cuomo and the leaders of the state Legislature have failed over 3.5 million New Yorkers by leaving town without doing anything to address a problem the Governor himself acknowledged a year and a half ago to is part of a national crisis: helping private sector employees save for a financially secure retirement,” said AARP New York State Director Beth Finkel.
“As fewer companies are able to offer retirement savings plans such as pensions and 401(k)s that previous generations took for granted, and with the federal government punting on the issue, it’s up to states to help hard-working families help themselves. Sadly, the Governor, Senate Leaders Flanagan and Klein and Assembly Speaker Heastie themselves punted.”
AARP has been urging state leaders for three years to enact Secure Choice, which would give employees who lack access to a workplace retirement savings plan the option to open a Roth IRA at work and contribute through payroll deduction.
The Secure Choice legislation has nearly 100 sponsors from both parties in both houses and would provide an effective way to save. Illinois, Oregon, California, Connecticut and Maryland have already enacted similar plans.
A recent AARP NY/Siena College poll found 82 percent of New York Generation Xers and Baby Boomers support a state-facilitated workplace retirement savings option for those who lack access, and a separate AARP survey revealed that 80 percent of the state’s small businesses think state lawmakers should support a plan to make it easier for small business owners to offer a way to save for retirement to their employees.
The 2017 session also ended with only a nominal increase in funding for services that help a fast-growing population of older New Yorkers age safely in their own homes, leaving well over 10,000 people on waiting lists.
The 2017-18 state budget added just $875,000 for non-Medicaid in-home services for the elderly that help middle class family caregivers avoid burnout and personal financial strain – which often lead to unwanted placements in much higher-priced institutional care settings at taxpayer expense.
That’s a mere 21 cents for every New Yorker 60 and over – far short of the $25 million it would take to make serious inroads in reducing waiting lists for these services around that state that total 17,000 New Yorkers. New York City recently adopted a new budget that includes sufficient funding to eliminate its own waiting list.
“Our population is aging, and nearly nine out of 10 New Yorkers want to age at home,” Finkel said. “Governor Cuomo, Senate Leaders Flanagan and Klein and Assembly Speaker Heastie should take a page from New York City’s book and make sure services that help New Yorkers age at home and support family caregivers – such as transportation to doctor’s appointments, home-delivered meals and assistance with daily activities – are adequately funded starting next year.
“This legitimate demand will continue growing, and these services represent the most compassionate and cost-effective way to care for our seniors. The alternative is much costlier, taxpayer-financed nursing homes.”
Nearly 2.6 million family caregivers provide unpaid care worth $31.3 billion annually in New York and should be supported in their efforts. And as the number of potential 45- to 64-years-old caregivers for every New Yorker 80 or older dwindles, from 6.6 in 2010 to 3.5 in 2050, the need for in-home services will continue increasing.
Strong majorities of New York’s Generation Xers and Baby Boomers say those services would help them care for loved ones at home, according to an AARPNY/Siena College survey – which also showed 87% want themselves and their loved ones to receive care at home and just 2% would opt for a nursing home.
Lawmakers also left town unable to agree on significant legislation to combat the rapidly growing problem of elder financial exploitation. The number of reported cases of elder financial exploitation increased by more than 35% between 2010 and 2014, and the problem costs New York and its residents $1.5 billion a year, according to a 2016 study by the New York State Office of Children and Family Services.
Over one third of victims showed signs of dementia. Yet legislators and the Governor failed to resolve their differences over whether and how to better train bank employees to detect and empower financial institutions to put a hold on potentially fraudulent transactions.
“As our population ages, the shameful crime of elder financial exploitation won’t go away – unless our leaders show the courage to address it and protect older New Yorkers and the assets they’ve worked a lifetime to secure,” Finkel said. “Leadership involves getting everyone – law enforcement, consumer groups, patient advocates and the financial industry – at the table and hammering out a solution. Unfortunately, that didn’t happen.”
AARP did praise lawmakers for passing legislation to:
- Establish a round-the-clock hotline to report suspected elder abuse, sponsored by the legislative Aging Committee chairs, Senator Sue Serino and Assemblywoman Donna Lupardo (S2154A/A8160).
- Provide property tax credits for more middle class New York City homeowners, sponsored by Senator Diane Savino and Assemblyman Brian Kavanagh (S4628A/A7463A).
- Provide tax credits for “universal design” of homes to allow the physically disabled greater access and mobility, sponsored by Senator John DeFrancisco and Assemblyman Charles Lavine (S2411A/A5950A).
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