Reset Retirement, a new podcast from our Retirement Equity Lab, tells the real stories of retirement. This is not the same, old retirement advice that is hard to follow in today's job market and makes us feel worse about our own saving. Rather, we hear from real people - millennials, mid-career professionals, and retirees - about how life has affected their retirement savings, how they cope, and what we can do to demand a system that works for real people. Listen above or wherever you find your podcasts.
Even if people have the health and strength to keep working past traditional retirement ages, there’s no guarantee they will be able to find a job. Instead, our retirement system abandons older people in an unfriendly labor market at the moment they are most vulnerable to age discrimination. In the fourth episode of Reset Retirement, we take a deeper dive into how the common advice to work longer plays out in real life.
First, we hear from Mikhail, a lawyer, and Stephanie, a former advertising professional. They both describe running into unexpected career disruptions in their late 40s and early 50s, revealing to them how age discrimination is a barrier to both keeping career jobs as you age as well as finding another one after a layoff. Next, we hear from our expert round table, including host Teresa Ghilarducci and our guests, Vincent Alvarez, President of the New York City Central Labor Council, and economist Tony Webb. Together, they lay bare the harsh realities of aging in the American workforce, how age discrimination interacts with low retirement savings, and the importance of the right to retire. Finally, we highlight those leading the charge against age discrimination in the courts.
Expert Roundtable Guests
Teresa Ghilarducci, Host, SCEPA Director, and Economics Professor
Teresa Ghilarducci is the Director of the Schwartz Center for Economic Policy Analysis (SCEPA) at The New School. She joined The New School after 25 years as a professor of economics at the University of Notre Dame and 10 years as director of the Higgins Labor Research Center at the university. Her latest book, co-authored with the Blackstone Group’s Tony James, argues our financialized pension system destabilizes the macro economy and fails to provide equitable, adequate and efficiently delivered retirement income. It outlines a bold policy vision to create Guaranteed Retirement Accounts (GRAs) for all American workers. Her research areas concern automatic stabilizers, financialization, and labor market dynamics. Ghilarducci holds a Ph.D from the University of California Berkeley.
Vincent Alvarez, NYC Central Labor Council President
Vincent Alvarez was elected as the NYCCLC’s first full-time President and first Latino President in 2011, and was re-elected in 2015 and 2019. He had previously served as Assistant Legislative Director of the NYS AFL-CIO, spearheading various worker-related policy initiatives throughout the state. From 2007-2009, Vinny was Assistant to the Executive Director and then Chief of Staff of the NYCCLC.
A member of the International Brotherhood of Electrical Workers (IBEW) since 1990, Vinny began his career with IBEW Local 3 in Flushing, New York, serving on numerous political campaigns, grassroots initiatives, and negotiating committees. During this time, he also coordinated hundreds of labor mobilization and campaign events on behalf of the NYCCLC’s affiliates and was the lead organizer and Marshal of the NYC Labor Day Parade, the nation’s oldest and largest worker parade. Vinny is a graduate of the State University of New York at Oneonta, where he majored in business economics.
Anthony Webb, SCEPA Economist
Tony Webb is the Research Director at SCEPA's Retirement Equity Lab. He is a widely recognized expert in retirement planning and policy. Prior to joining SCEPA, Dr. Webb was a senior research economist at Boston College’s Center for Retirement Research, and a senior research analyst at the International Longevity Center. He completed his PhD in economics from the University of California, San Diego. His research interests include the impact of pension type on the retirement age, the financing of long-term care, and the management of the process of asset decumulation.
Full Episode Transcript
— INTRO —
Teresa: The messages we get about retirement these days are “be afraid” and “it’s all your fault.” We’re told that if, like most people, we don’t have enough saved for retirement, it’s because of what we did, not the system’s fault.
But is that the truth? The Reset Retirement Podcast asks, what does retirement really look like for Americans?
By hearing from people who have both struggled and succeeded in saving, we can learn where the real problems lie within our system. We can stamp out retirement-saving shame, and we can discuss real solutions.
I’m your host, Teresa Ghilarducci, a labor economist and professor at the New School for Social Research. In our fourth episode, we question the advice people hear all the time: “if you don’t have enough saved, you can always work longer.” We ask our guests and our expert roundtable if that’s really possible, by discussing: how long can we work?
Teresa: One of the warning signs of the oncoming retirement crisis is how often people are told to work longer. If you haven’t been able to save enough - work longer. If you’re savings are wiped out by sickness or economic downturn - work longer. But even if people have the health and strength to keep working past traditional retirement ages, there’s no guarantee they will be able to find a job. Today we take a deeper dive into how this advice plays out in real life.
I'm happy to welcome today's reset retirement guest Mikhail. Mikhail, can you introduce yourself and tell us a little bit about yourself.
Mikhail: Sure. Mikael Iliev is he's my name and I am a Bulgarian citizen by birth by nationality. I am a very young 52. I came to this country a while ago. I would say, well, it was 1990 December. So that makes it what twenty nine years or so.
Teresa: And so what is your job?
Mikhail: My retirement life and my retirement savings potentiality was kind of formed by two major lucky breaks. One of them was that my adviser, I was gonna go into philosophy back at Bates College. My advisor said no son, don't do that. You're going to doom yourself to the life of an itinerant knight. Go into law.
So I go into law, and lo and behold it was a great move from many perspectives. I got hired by a very good law firm and tons of money were thrown at me. And so that was a bit of a lucky break because as foolish as you might be, they throw a lot of money at you and some of it’s gonna stick. Some of it is gonna end up in a retirement somewhere saved.
Teresa: So they throw money at you, you threw money back into a retirement account. So how long did you save?
Mikhail: I was pretty good about saving for retirement. There was a 401k, but it wasn't automatic. It was an automatic opt in, and I had to decide everything.
Teresa: So. So you've just save for what, 10-15 years.
Mikhail: Largely 17 years or so. So I was able to save a very decent amount. Even I, with this lucky break, and I was surrounded by people that were all about “you got to save,” “you got to put away some money.” But even with that, there are powerful tendencies for people to consume now.
Teresa: So you're making big money, you're saving pretty well for 17 years. You have these temptations to spend. How are you now?
Mikhail: I have fallen behind woefully.
Teresa: And what happened?
Mikhail: I was kind of subject to the big trifecta. I have tremendous trouble vis-a-vis my marital life. We're on the path to divorce slash separation. I had a health crisis. I was in the hospital and and I lost my cushy, high-paying job about a year and a half, two years ago. These things are intertwined and long-story short, it wasn't the fiscal part that nearly killed me or the disease. It was largely the consequences of it.
Teresa: Especially when you're not 30 and you're approaching 50.
Mikhail: Exactly...I would second that. There is a lot to be said about that because, as we discussed previously, these things feed into each other. Once you get close to 50 and over 50 people, look at you in a different way. Even at the positions we talk about with partnership-track level at law firms or high-paying, in-house positions for lawyers.
Teresa: I don't want to put words in your mouth, but you're feeling the effects of age discrimination.
Mikhail: I am feeling the effects of age discrimination. I think so. And you know, I'm pretty fair minded as a person. But I've been up for jobs that are right up my alley, that I have all the credentials for, and I've lost out to people that are below 50. There's a lot of things that go into that decision. I can't be quite sure, but it’s there. And that's very telling for companies because I've been on the opposite side. I've hired people too. I see if they're over 50, I'm told “be careful ,if you can avoid it - avoid it.” People are always looking to cover their backsides.
Teresa: So what does your work life and your work future look like now?
Mikhail: Everything’s been pushed back by at least several years. My horizon for being able to retire is pushed back now. I've had to dip into my retirement savings because of the intervening two years. I'm able to now get a decent job, but I have to make up for lost time. The disease- slash - lost jobs - slash - problems of marriage...it doesn't happen to 22-year-olds or 30. It tends to happen to people in older age.
The individual can't really do anything about it. Everybody has to pitch in to try to right this problem because we're in it together in a way. And the individual’s willpower and brilliance and smarts is one thing. And of course nobody wants to pay for the other person's sloth or lack of aggressiveness or lack of ambition. But at the same time, we're so interconnected that you can't disregard these things.
Teresa: And it sounds like you are expecting to work?
Mikhail: Yeah, there is an expectation that if you work hard and you do the right things you will not be wanting. Or you will not be left in the dust and like my parents in Bulgaria and denied basic retirement comfort. But I feel that some of that is actually happening to me. Because through forces that were largely beyond my control, I was set back and really brought to my knees, to be honest with you.
Teresa: There's just something about you that just makes me think that any employer that nabs you is going to be really lucky.
Mikhail: Yeah? I should miniaturize you and put you in my pocket so you can motivate me!
Teresa: Welcome to reset retirement. Thanks for being our guest today.
Stephanie: You're very welcome. Thanks for having me.
Teresa: Can you tell me a little bit about yourself?
Stephanie: My name is Stephanie, and currently I am building my own business, my own private clientele. You could call it coaching. I've been doing that for 18 months, let's say - a couple of years. Before that, I was in advertising in New York City for about 15 years. I'm 46 - I'm 47 this year.
I was rising through the ranks very swiftly, and I thought it wouldn't stop. But I hit the glass ceiling - slammed into it so hard. I feel it's a combination of my age...at a certain point in advertising, I can't speak for any other industries, they call it “aging out.” They literally call it “aging out.” And I just hadn't got high enough, soon enough. I was moving up rapidly, and I knew I had to because I entered at the age of 30, not 20. But it just wasn't fast enough. And I also think there’s a factor of me being female in a in a very male-dominated world.
Teresa: So you're aged out of your job where you’ve accumulated a lot of skills, but you aren't yet old enough to retire?
Stephanie: No way!
Teresa: So what do you do between the time that you're too old to work there, but too young to retire?
Stephanie: Well, I'm not even thinking about retirement as a concept any more. I'm just not. So the answer to your question, “What do I do?” is, I hustle! I do the New York hustle. “Okay, here I am.” I'm trying to dissolve the fear and live with the courage that I had in my 20s, because I wasn't afraid of anything. I just hustled. And one opportunity led to another led to something else.
Teresa: So if you picture yourself a little bit older, five/six years older, is this hustle is going to pay off?
Stephanie: Yes it has to. It absolutely has to. It absolutely has to. There's no way out. I just have to keep going. There's no way out.
Teresa: And as you're hustling, are you saving for retirement?
Stephanie: Well yes and no. I do take part of every dollar I earn at this point. It's 1% because I've just started running my business - at a loss. But as I earn more, I will push it up to 15%. That's my goal for next year, and we'll see where we go from there. Now that just goes into an account now. I might have to use that for something. I don't know. But the plan is not to use it for anything other than to roll it over into what I gathered from my advertising years.
Teresa: Stephanie, I’m just beginning to get to know you, and I imagine that you have a lot of friends and a lot of women friends. Have they had the same experience that you've had?
Stephanie: Yes. So I landed in the middle of this community of female entrepreneurs. I found that many of them had the same story. You know they said, “Oh yeah. I was called in to H.R. one day. I was doing a great job, and suddenly it was “we no longer need of your services.” So what do I do now? Many of us have that in common.
Teresa: When you think about your future self - and I know the current self is taking a lot of lot of energy in envisioning yourself - do you think of yourself as a point in time where you don't have to hustle?
Stephanie: No, I really don't. I don't think of it as a point where anything changes. No, I really don't.
Teresa: You'll die in your boots?
Stephanie: Yeah, which I'm happy to do because at this point I'm forming a life for myself where work feels like play anyway. So that's my idea. To live life fully, and not have to change that. I'm much happier every day now, even though I'm not in this system which is supposed to be secure. So I intend to continue and yeah - die my boots. Absolutely!
Teresa: Thank you to Stephanie and Mikhail for sharing their experiences.
Stephanie and Mikhail spent their careers in different industries. Yet both experienced job loss and other shocks as they got into their late 40s and early 50s. Despite having saved, they now have to stay in the labor market much longer than expected.
My question for today’s experts in our roundtable is, what do these experiences tell us about our system as a whole? If people can’t save for retirement, how long can they really expect to work?
I'm happy to welcome today's reset retirement roundtable Vinny Alvarez and Tony Webb. May I ask you to introduce yourselves? First, Vinny.
Vinny: Thanks for having me on. I'm Vinny Alvarez. I'm the president of the New York City Central Labor Council. We represent about 1.3 million workers here in the city of New York from the public sector unions, the private sector unions, and the construction trade unions. In addition to that, I've been a union member myself for 29 years with the electrical workers union.
Teresa: And Tony?
Tony: Hi, I’m Tony Webb. Thanks for inviting me. I'm a pension economist. I work at The New School. I have a PhD in economics (for what it's worth) and I've spent the last 20 years studying the U.S. pension system.
Teresa: What's really interesting about your experience, Vinny, is that most of your members have pensions.
Vinny: Sure they do. I think the last figures were about 71% of New York City—of union households in New York City—have pensions, which is in contrast to the 59%, it's now up to 65%, of workers in New York City who don't have any.
Teresa: Exactly. It’s like the opposite.
Vinny: Yeah. So it’s exactly opposite
Teresa: It's really great to have both of you here today because we're going to talk about what happens when people, especially people with good jobs, lose it a lot faster a lot sooner than they thought they would
Teresa: Tony, how many people actually keep their career jobs all the way to 65?
Tony: The data shows that probably one half of workers in their 50s ends up retiring involuntarily.
Teresa: One half?
Tony: Slightly over a half.
Teresa: So when we talked to Stephanie and Mikail, they talk like there were among a handful of of their friends. Stephanie talked about all the women in advertising who were asked to leave in their 40s and 50s when they were making a lot of money. And Mikhail, he felt like he was sort of all alone, but that's not true?
Tony: They're really not alone. The problem is that Excel spreadsheets assume that if you work until 65, you'll be fine. They don't accord with how life really is, especially for blue collar workers, but even for white collar workers who are just as vulnerable to involuntary job loss.
Vinny: You talked about the really significant amount of people who are either having to make the determination at a certain point that either I'm going to - because of a lack of retirement security - have to find another job and work until the day I die (without being overly dramatic for some of them). Or, I'm going to have to retire poor, which is a problem, and be in poverty or become a burden for other family members or friends who have the ability and the means to help them out. Or, they become a burden on municipalities and government. Each one of those situations is not something that is desirable, either for society or for the individual.
Teresa: Yeah I know. They're faced with really bad choices, and a lot of our guests think it's their own fault. And what we're trying to do here is to talk about that we're not alone. The pension system has changed a lot. At the same time, the labor market has changed a lot. Because of recession or because in the business model, it is much more profitable to end people's careers not at 65, but in their 50s. I see a lot of ageism even in talking about the presidential candidates. How does that filter down into everyday life when people in their 50s are looking for work?
Tony: So if older workers do lose their job, they face much more difficulty than younger workers in finding a new job. And if they do find a new job, it will often be at significantly lower pay and will often involve a loss of benefits. The principal benefit that individuals often lose is access to a savings plan. And that makes it harder for them to get back on track for retirement.
Vinny: I have seen some dramatic shifts in occupations and careers. People who are in finance making very very good, comfortable salaries have had to take a dramatically lower paying job in a completely different industry in a completely different region. This has a dramatic impact on them, as we've seen with so many people that we talked to in our personal lives and professionally as well.
Teresa: We saw that with Stephanie and Mikhail. They realized they didn't have the savings to last for the rest of their lives and take care of their kids. They both have dependents. So they really expressed that their plan was hope. Hope that they'll always be able to work. But hope isn't a plan. And I feel that if we don't address the unlikelihood that they'll be able to work until the till they die, that they will fall into those three problems that you stated. They’ll either be poor, they'll be a burden on their families, or they will they be a burden on the government.
Vinny: We've seen this certainly with those of us who've had the benefit of having a union contract and work on their collective bargaining for years. As I tell people, these weren't giveaways. This was deferred compensation. For workers who are in physically demanding jobs - try being a nurse and lifting patients for 30 or 40 years - your body just begins to break down.
Teresa: We're almost having to defend the right to retire. But what we heard from Stephanie and Mikail is a loss of that expectation of retirement and just accepting it, which is very American. That we will work until we die. Tony, what do jobs that older people have actually look like? So let's say you're in your second career—what are those jobs?
Tony: So very often, the jobs that older workers take are low-paid, service sector jobs. The single fastest growing sector of work amongst older workers is home health care work. This is physically demanding work. It's not well-paid. And it certainly doesn't offer those who are doing that work, a path to a secure retirement.
Vinny: We have to make a distinction between somebody staying active in their retirement years and active because it's their decision and they're choosing. I think that's great. I tell all my friends as they get ready retiree - stay active. It’s good for the mind, it's good for the body, it's good for the spirit. But for those who have no economic choice because otherwise they may become homeless if they don't go to work. That's a different kind of solution. So we have to be careful.
Tony: So there's a lot said about work and social engagement. The argument goes that work at older ages is great because it gives people social engagement. I like my job, and I have a social engagement at work. But to be quite honest, I can get my social engagement elsewhere.
Teresa: Thanks Tony. Tony and I work together! But what is really interesting about this conversation is that as Americans, we are fighting for the legitimacy of a secure retirement, but also as Americans, we are fighting for the right to work.
Vinny: The flipside of that, as we talked about, is having a retirement security that if people so choose to retire that they have the means and the ability to retire. And we've fallen short on that tremendously. In order for it to work out successfully, you need to have government, businesses, corporations, and individuals all taking part in that. I think too much of that burden has been shifted onto the individual now and away from government and away from businesses.
We’re all putting our heads in the sand if we think that somehow you’re going to be able to retire on such a small amount of income that, generally speaking, Social Security provides - with no other benefit coming in.
Teresa: Exactly, right. That's what's so interesting about union workers, who were like the original gig workers - construction workers, musicians. Some of your members are out of work maybe a couple of months out of the year. But when they go back into work, they're in a retirement plan that sits on top of Social Security. So whenever they have work, they save a little bit, and they don't take it out when they leave work. So you have these portable mandatory pension plans.
Vinny: Well, it worked out well for about 30 years from the 50s, the 60s, and the 70s, and maybe in the mid-80s. But then that compact and that contract broke down because not everybody was in it.
Teresa: Correct. I guess you had a lot of non-union people in the industry that didn't have to do that.
Vinny: I think it accurately reflects the level of inequality that we see here in New York City, that in the city with the highest union density in the country - nearly 25% - we also have 65% of working people that have no form of retirement benefit, no defined benefit, or traditional defined benefit or defined contribution plan.
Teresa: That’s all the time we have today. Thank you, Vinny and Tony, for joining our expert roundtable. And thank you, Stephanie and Mikhail, for sharing your stories.
Now it’s time for our final segment. This is where we feature the “bright spots” of retirement, the stories that are giving us hope for retirement reform.
Bridget: I’m Bridget Fisher, Associate Director here at the Retirement Equity Lab. I joined the first episode of Reset Retirement. I talked about how, at 43, I worry that my retirement relies on keeping a good job as I get older.
So for today’s bright spot, I want to talk about those leading the charge against age discrimination in the job market - by taking to the courts. Author Sheila Callaham wrote recently in Forbes that there’s an uptick in the profile and pace of age discrimination lawsuits. We’re seeing more lawsuits against bigger fish, including Citibank, IBM and Ikea.
For those who feel they have been discriminated in the workplace due to age, please reach out to the AARP Foundation, who supports workers through legal advocacy and information.
This wave of lawsuits is a wake up call for employers. Just as we attack discrimination based on skin color, gender, and religion, we also demand an end to age discrimination.
Teresa: Thank you so much for listening to Episode 4 of Reset Retirement. You can find us on iTunes or Spotify or wherever you find your podcasts.
This podcast is brought to you by the Retirement Equity Lab at The New School.
This episode was produced by Bridget Fisher and Anna Low-Beer and edited by David Fuchs.
We hope you’ll subscribe and join us for our next episode where we ask, “Where do we go from here?”