From the U.S. Government Accountability Office, www.gao.gov Transcript for: Income and Wealth Disparities through Old Age Description: Do income and wealth disparities continue through old age? If so, what effects can that have? Related GAO Work: GAO-19-587: Retirement Security: Income and Wealth Disparities Continue through Old Age Released: September 2019 [ Background Music ] [ Charlie Jeszeck: ] Higher income people are getting wealthier. They have much greater income. Those disparities have increased over time. [ Matt Oldham: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. I'm Matt Oldham. The gap between the richest and poorest Americans has grown over the past several decades. And during this time, life expectancy has gone up for Americans, just not equally across the population. I'm with Charlie Jeszeck, an Education Workforce and Income Security director at GAO. And he's here to talk about a report that examined the income and wealth gaps among older Americans and links to longevity. Thanks for joining me Charlie. [ Charlie Jeszeck: ] Thank you. [ Matt Oldham: ] Do Americans who earn more money or have more money live longer than those who earn or have less? [ Charlie Jeszeck: ] First of all, let me step back a bit and talk a little bit about the disparities in income and wealth. And what we did here in this report we looked at them for people, households headed by somebody aged 55 and older. So we just focused on that group, and what we find is really consistent with what the research has found for the population in general for the workforce in general. And we looked at a period from 1989 to 2016, and we found that for the top quintile, the top 20 percent of elderly households that the average income went up by 64 percent, up to about 398,000, while for the bottom quintile, the bottom 20 percent it went from $9,000 per household in 1989 to $14,000 in 2016, up about 55 percent. And if you look at wealth in particular, the 1 percent is garnering a disproportionate amount of the income and wealth in the United States. So, for example, in 1989, the top 1 percent of elderly households they had $13 million more in wealth than the next 19 percent of that quintile, about 10 times as much. By 2016 this increase they had $34 million more, and 13 times as much as the next 19 percent. So we see a shift, not only from the lower income quintiles to the higher income quintiles, and then within the top quintile up to the 1 percent. [ Matt Oldham: ] Does this have any effect on longevity? [ Charlie Jeszeck: ] There have been other research, which has identified separate distinct demographic groups in the United States that have not shared in the fruits of increased longevity like that other groups have. So, for example, we looked at groups where groups with lower income, the bottom quintile compared to the top quintile, and what we did is actually a fairly complicated methodology, but we looked at people beginning in 1992 we ranked all the people in the lowest quintile in 1992, and then followed them over the next 20 years to 2014 to see how many of them were still alive in 2014. We found that the bottom quintile only 52 were left by 2014, of 52 percent of that bottom quintile. Compared to the top quintile it was 74 percent, so this is a significant disparity. In fact, it's greater than the longevity disparity between men and women. Women typically live longer than men. We found though by the same period that there were 69 percent of the women left in 2014 compared to only 58 percent of the men, so a much larger disparity based on income. [ Matt Oldham: ] So why is the government interested in this? [ Charlie Jeszeck: ] Well, what we found is that there's still a significant number of people in the lowest earnings group who have long life spans. They will be dependent on Social Security though, but also they're the most vulnerable to a health shock, and may be in need of other social services. So this is something that for the federal government would be concerned about. [ Background Music ] So it sounds like older Americans who earn the least or have less wealth they don't live as long as those in the richer categories? So what can be done with this information? [ Matt Oldham: ] Wealth and income equality is something that is on the minds of policymakers, and people throughout the country. The research that we've found it's an important piece of the puzzle. Did the existing research, because we look at it in terms of just the elderly. And so this really points out to the potential vulnerabilities for lower income people who do have extended life spans as they move into retirement. [ Matt Oldham: ] And final question, what's the bottom line? [ Charlie Jeszeck: ] Higher income people are getting wealthier. They have much greater income that those discrepancies, those disparities have increased over time. And similarly the issue of longevity we know now that longer life spans are not equally shared. And this certainly is the case for people with lower incomes, people who are less educated, people who not have good health, but nevertheless there are a lot of people who still have long life spans, and are going to be vulnerable to health shocks later in life, be vulnerable possibly to poverty, and need further other social services. And again, this is very consistent with research out there that--that's looked at longevity issues. [ Matt Oldham: ] Charlie Jeszeck was talking about the longevity of older Americans and the disparities in income and wealth. Thank you for your time, Charlie. [ Charlie Jeszeck: ] Thank you. [ Background Music ] [ Matt Oldham: ] And thank you for listening to the Watchdog Report. To hear more podcasts, subscribe to us on Apple Podcasts. For more from the congressional watchdog, the U.S. Government Accountability Office, visit us at gao.gov.