[Senate Hearing 117-109]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 117-109

                     BUILDING WEALTH AND FOSTERING 
                         INDEPENDENCE: CREATING
                         OPPORTUNITIES TO SAVE

=======================================================================

                                HEARING

                               BEFORE THE

                       SPECIAL COMMITTEE ON AGING

                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS


                             FIRST SESSION

                               __________

                             WASHINGTON, DC

                               __________

                             JULY 15, 2021

                               __________

                           Serial No. 117-05

         Printed for the use of the Special Committee on Aging
         
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]         


        Available via the World Wide Web: http://www.govinfo.gov
        
                               __________

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
45-315 PDF                 WASHINGTON : 2021                     
          
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                       SPECIAL COMMITTEE ON AGING

              ROBERT P. CASEY, JR., Pennsylvania, Chairman

KIRSTEN E. GILLIBRAND, New York      TIM SCOTT, South Carolina
RICHARD BLUMENTHAL, Connecticut      SUSAN M. COLLINS, Maine
ELIZABETH WARREN, Massachusetts      RICHARD BURR, North Carolina
JACKY ROSEN, Nevada                  MARCO RUBIO, Florida
MARK KELLY, Arizona                  MIKE BRAUN, Indiana
RAPHAEL WARNOCK, Georgia             RICK SCOTT, Florida
                                     MIKE LEE, Utah
                              ----------                              
                 Stacy Sanders, Majority Staff Director
                 Neri Martinez, Minority Staff Director
                        
                        C  O  N  T  E  N  T  S

                              ----------                              
                                                                   Page

Opening Statement of Senator Robert P. Casey, Jr., Chairman......     1
Opening Statement of Senator Tim Scott, Ranking Member...........     3

                           PANEL OF WITNESSES

Thomas Foley, Executive Director, National Disability Institute, 
  Washington, D.C................................................     6
Rodney Brooks, Retirement Columnist and Author, Silver Spring, 
  Maryland.......................................................     7
Josie Badger, Ph.D., Campaign Manager, #IWantToWork, New Castle, 
  Pennsylvania...................................................     9
John Iacofano, Owner, Iacofano's Catering, Mount Pleasant, South 
  Carolina.......................................................    11

                                APPENDIX
                      Prepared Witness Statements

Thomas Foley, Executive Director, National Disability Institute, 
  Washington, D.C................................................    29
Rodney Brooks, Retirement Columnist and Author, Silver Spring, 
  Maryland.......................................................    32
Josie Badger, Ph.D., Campaign Manager, #IWantToWork, New Castle, 
  Pennsylvania...................................................    36
John Iacofano, Owner, Iacofano's Catering, Mount Pleasant, South 
  Carolina.......................................................    40

 
                     BUILDING WEALTH AND FOSTERING
                         INDEPENDENCE: CREATING
                         OPPORTUNITIES TO SAVE

                              ----------                              


                        THURSDAY, JULY 15, 2021

                                       U.S. Senate,
                                Special Committee on Aging,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:37 a.m., via 
Webex and in Room SD-562, Dirksen Senate Office Building, Hon. 
Robert P. Casey, Jr., Chairman of the Committee, presiding.
    Present: Senators Casey, Blumenthal, Kelly, Warnock, Tim 
Scott, Braun, Rick Scott, and Lee

  OPENING STATEMENT OF SENATOR ROBERT P. CASEY, JR., CHAIRMAN

    The Chairman. The Senate Special Committee on Aging will 
come to order. I would like to welcome everyone to the Aging 
Committee's first hybrid hearing of this Congress, with members 
having the option to attend in person or online. Welcome, 
everyone.
    This hearing will focus on the challenges individuals face 
when working to achieve long-term financial security and save 
for a stable retirement. All Americans worry about their 
economic future, especially as we grow older. For people with 
disabilities, finances, savings, and income are especially 
worrisome issues. According to the Bureau of Labor Statistics, 
in 2020, across all age groups, people with disabilities were 
much less likely to be employed than those with no 
disabilities. The same report found that across all educational 
attainment groups, unemployment rates for people with a 
disability were higher than for those without a disability.
    Since people with disabilities are less likely to be 
employed and much more likely to be underemployed, their 
lifetime earnings are far less than the average citizen. Family 
members are often forced to quit their jobs to help care for 
other family members, family income has often been 
significantly limited.
    For these families, Congress has removed some of the 
barriers to saving and to planning for the future. The 
bipartisan Stephen E. Beck, Achieving a Better Life Experience 
Act, or as we know it by the acronym the ABLE Act, which 
Senator Burr and I led in the Senate when it passed in 2014. 
This act makes it possible for people with disabilities to save 
for the future. With an ABLE account, people with disabilities 
can save for the future without losing their Federal disability 
benefits such as Supplemental Security Income or Medicaid. With 
the opening of ABLE accounts in 43 states, over 91,000 people 
have been able to save over $759 million, an average of over 
$8,300 per account.
    These essential assets allow people to open their own 
businesses, save for retirement, purchase the technology they 
need, and so much more. That includes, in my home State of 
Pennsylvania, over 5,200 people who have used ABLE accounts to 
save over $57 million so far.
    One such Pennsylvanian is a member of our witness panel 
today, Dr. Badger, who will tell us how an ABLE account helped 
her buy her first home.
    ABLE has made building wealth a real possibility for 
millions of Americans but our work on this issue is not done. 
ABLE accounts are not available to all people with 
disabilities. To open an account, a person has to acquire their 
disability prior to their 26th birthday. This needs to change. 
Many people acquire their disability after age 26, including 
over 1 million veterans.
    That is why Senator Jerry Moran of Kansas and I, along with 
10 additional colleagues--four Republicans, six Democrats--have 
introduced Senate Bill 331, the bipartisan ABLE Age Adjustment 
Act. The bipartisan House version, which is H.R. 1219, has been 
introduced by Representatives Tony Cardenas and Judy Chu of 
California and Cathy McMorris Rodgers of the State of 
Washington. They have been joined by 39 Democrats and 20 
Republicans to help pass this important legislation.
    The ABLE Age Adjustment Act will provide 6 million 
additional Americans with disabilities with the opportunity to 
open an ABLE account. The ABLE Age Adjustment Act legislation 
is an important step toward a more stable economic future for 
people with disabilities. There remain other challenges which 
must be addressed. As we will hear today, barriers to economic 
also plague many communities of color. Higher levels of poverty 
and unemployment have made it more difficult to save long-term 
for many people from African American, Latinix, and other 
diverse communities. This is a disturbing set of numbers I am 
about to read.
    A 2020 report from the Federal Reserve, and that is 
obviously very recent, estimated that white families had eight 
times--eight times--the wealth of the typical Black family and 
five times the wealth of the typical Hispanic family. No one 
can be satisfied with those numbers. The same report has also 
found that the asset-based net worth of white households was 
more than four times the level of Black households. As a 
Nation, we have only begun to address the barriers to economic 
security for people with disabilities and communities of color 
as they age.
    I look forward to hearing from our witnesses today about 
these important issues and the progress we hope to be able to 
make.
    Before we begin, I want to remind Committee members and 
witnesses to please keep remarks and questions to five minutes. 
Following opening remarks, Senators will ask questions based on 
seniority whether joining in person or by camera virtually.
    Ranking Member Scott, I am pleased to turn it over to you 
for your opening remarks. It is great to see you in person.

     OPENING STATEMENT OF SENATOR TIM SCOTT, RANKING MEMBER

    Senator Tim Scott. Thank you, Chairman Casey.
    It is good to see you in person, as well. This is such an 
important Committee and we do good work under your leadership 
and I appreciate the way that you have handled the 
responsibilities of chairing this Committee and keeping our 
focus not on each other or each side but on the American people 
and specifically on seniors and folks with disabilities. It is 
really important for us to recognize that many of us are 
blessed. We are blessed to serve in the U.S. Senate on behalf 
of our states and on behalf of people who need help.
    One of the things I think about, Chairman Casey, as I 
ponder this conversation around retirement security is how 
fortunate we are to be in a position where we have retirement 
accounts connected to what we do. Many times folks who have 100 
employees or fewer do not have access to a retirement account. 
I know that is true here in Washington, DC. as well as it is 
true at home in South Carolina.
    Growing up in poverty has another impact on that wealth gap 
that you talked about, the difference between African 
Americans, Hispanic and white folks, the amount of net worth 
they have typically can manifest in the equity in a home. If 
you do not have access to home ownership because of challenges, 
then you are going to see that wealth gap only increase. As 
that wealth gap increases, we will see that have an impact on 
how comfortable you are in retirement.
    There are many pieces to the life puzzle of retirement that 
we will address today and I am thankful that we have an 
opportunity to do so. I am also thankful that, as a kid growing 
up in poverty, I had the chance of meeting a small business 
owner who was my mentor, who started teaching me about 
financial literacy at 15, 16, and 17 years old. That was a 
blessing that too many Americans do not have.
    Learning those lessons early in life allows for your 
retirement years to look very differently. Far too many 
Americans living paycheck to paycheck, including vulnerable 
populations facing poverty, and some with disabilities, 
retirement seems out of reach no matter how old you are.
    Too often, you see good people who have worked all their 
lives having to continue to work well into what we would 
consider your traditional retirement years.
    For others, there are obstacles such as keeping your 
retirement plan when you are switching jobs. Getting access to 
a retirement plan when working for small businesses, as I just 
mentioned, is harder to do. In South Carolina, approximately 
400,000 full-time employees do not have access to an employer-
sponsored retirement plan. Two hundred thousand-plus South 
Carolinians who are working part-time do not have access to a 
retirement plan.
    African Americans disproportionately have less access than 
other folks. Employers are a critical major piece of this 
retirement puzzle. One of the ways that we can help this is to 
make sure that employers have an easier access to establishing 
retirement plans.
    As a former small business owner myself, I know the passion 
that we have for our extended families that we see as our 
employees. We see our employees as a part of our extended 
families. When we have an easier path to establishing and 
setting up retirement accounts for our employees, we look 
forward to that opportunity. We lean into that opportunity. It 
does solve a lot of problems. When you are making between 
$30,000 and $50,000 a year you are 12 times more likely not to 
be able to save for your retirement unless you work at a place 
where they have a retirement system there. Despite wanting to, 
small employers find it difficult and often impossible to 
provide retirement plans because of administrative burdens, 
startup costs, fees, and liabilities.
    There is good news, though. The SECURE Act signed into law 
in December 2019 makes it easier for small business owners to 
set up retirement plans that are less expensive and frankly, 
much easier to administer. Today we will have the good fortune 
of hearing from an entrepreneur, a South Carolinian, John 
Iacofano, who is launching his company's first retirement plan 
today. Wonderful. I am excited to hear from John.
    This new retirement plan is also the result of work by Matt 
Watson, a local advisory in Charleston who is helping small 
businesses across the State launch their own plans.
    We have wonderful examples throughout the great State of 
South Carolina of these folks taking advantage of a simpler, 
more effective way of providing for retirement security for 
their employees. Bitty and Beau's Coffee in Charleston is one 
of those great examples that comes to mind. This coffee shop 
specifically employs folks with disabilities, helping them 
achieve financial independence.
    Despite the struggles that so many Americans face, there is 
good news. Two-thirds of Americans living in retirement over 
the age of 65 over the past 5 years say that retirement is 
becoming a little more comfortable. In 2019, four out of five 
Americans aged 65 and older reported having enough money to 
live comfortably. This all means the financial well-being of 
seniors has improved substantially in recent decades and it 
gets better every single year. There is still more work to be 
done, and that is one of the reasons why we are working on what 
I would call SECURE Act 2.0, a bill designed to help us solve 
some of these problems and overcome some of the challenges.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Ranking Member Scott.
    Now we will turn to our witnesses. Before I do that, I want 
to acknowledge the presence of Senator Blumenthal, who is here 
with us. We will have Senators coming in and out today. As you 
know, Thursday morning is a busy committee morning, so we will 
have Senators coming in, sometimes coming in and having to 
leave and come back for questions. We will try to fit everybody 
in as they are available.
    I want to turn to our first witness, Mr. Tom Foley. Mr. 
Foley is the Executive Director of the National Disability 
Institute. He has more than 30 years experience in the 
disability community. He has dedicated his career to working to 
create pathways to employment and financial security for people 
with disabilities. We welcome him.
    Our second witness is Mr. Rodney Brooks, a retirement 
columnist and author. He brings decades of experience writing 
on retirement, personal finance, and business issues for 
publications ranging from U.S. News and World Report, the 
Washington Post, and the Philadelphia Inquirer. He has 
committed his career to helping people prepare for retirement 
and save for the future. We welcome Mr. Brooks.
    Third, our third witness is, as I mentioned earlier in my 
opening statement, Dr. Josie Badger from New Castle, 
Pennsylvania. That is Lawrence County on the Ohio border in 
Western Pennsylvania, north of Pittsburgh. Dr. Badger is the 
founder of J. Badger Consulting, Incorporated where she 
provides youth development and disability consulting services 
for various organizations.
    She is the campaign manager of the United Way of 
Southwestern Pennsylvania's #IWantToWork campaign, where she 
works to improve the employment of people with disabilities. 
She is also a person who knows firsthand the challenges people 
with disabilities face when trying to save for the long term.
    Due to the Federal asset limit for many years, Dr. Badger 
was unable to save more than $2,000 without risking the loss of 
her Federal benefits. That changed with the passage of the ABLE 
Act, which allowed her to finally save for her future.
    For our fourth witness, I will turn to Senator Scott, our 
Ranking Member, to introduce Mr. Iacofano.
    Senator Tim Scott. Thank you, Chairman Casey.
    It is my pleasure to introduce today John Iacofano. John is 
the owner of Iacofano's Catering in Mount Pleasant, South 
Carolina. He is an entrepreneur, a leader, and a successful 
employer. I am proud of his work and the company he has built 
in my home State.
    With only $90 to his name and money coming in from a 
painting job, John opened his first location in February, 2002. 
Today, John has 85 employees, six locations across the country 
including Charleston, Denver, Cleveland and Philadelphia. 
Iacofano's provides catering and food services to corporate 
events, weddings, in-flight service, senior living facilities, 
and meal service non-profits such as Meals on Wheels, which 
proved so critically important during the peak of COVID-19.
    John's testimony today is about his efforts and success at 
offering a brand new retirement savings plan to his employees 
because of the passage of the SECURE Act.
    I do not want to steal his thunder about what he is doing 
on this, his launch date for the retirement plan, but I look 
forward to hearing his comments.
    John, we truly appreciate your entrepreneurship and hard 
work offering new opportunities to your employees. Thank you 
for taking the time to be with us today.
    The Chairman. Thanks, Ranking Member Scott.
    Now we will turn to our witnesses for their statements. We 
will begin with Mr. Foley. Mr. Foley, you may begin.

    STATEMENT OF THOMAS FOLEY, EXECUTIVE DIRECTOR, NATIONAL 
             DISABILITY INSTITUTE, WASHINGTON, D.C.

    Mr. Foley. Good morning, Chairman Casey, Ranking Member 
Scott, and other distinguished members of the Committee. Thank 
you for the opportunity to be here today.
    My name is Thomas Foley. I am the Executive Director of the 
National Disability Institute. In addition to that, I am 
someone who is blind, who has spent time on SSI, spent time on 
SSDI but has managed, over time, to build an economic future 
for myself and my family.
    As was mentioned earlier, there are far too many barriers 
to economic advancement for people with disabilities. I still 
vividly remember as a freshman in college, learning about the 
$2,000 asset limit because I was on SSI. I thought the person 
who told me that was actually joking. I wanted what everyone 
else did. I wanted to buy a home. I wanted a financial future, 
a job that led to a career, a family. I wanted the American 
dream. I was not sure how I was going to accomplish the 
American dream if I was not allowed to save money.
    That $2,000 asset limit has not changed since I was a 
freshman in college and that was a while ago. Simply put, asset 
limits and income limits discourage savings, work and hope for 
people with disabilities.
    Many other factors complicate building an economic future. 
As was mentioned, people with disabilities have a difficult 
time finding stable full-time employment. Workforce 
participation rates in June, according to ODA the workforce 
participation rate for people with disabilities was 21 percent 
versus 67 percent for people without disabilities. It is nearly 
impossible to save for a long--term future without stable 
competitive employment.
    In addition to that, recent research has shown that people 
with disabilities face additional costs that people without 
disabilities do not face. They average $17,000 a year. These 
extra costs have to be met somehow, as well.
    I was really lucky in high school as well, as was Senator 
Scott, to take a financial education course. I learned about 
saving money, how to avoid debt, how credit cards worked, why 
it was so important to get a bank account. Recent data from the 
FDIC reports that people with disabilities are three times more 
likely to be unbanked, 16 percent versus 4.5 percent, than the 
rest of the population. It is difficult to build a financial 
future without the basic building blocks of a bank account or 
financial education and financial coaching for people with 
disabilities.
    Underlying much of this is an unspoken but palpable belief, 
sometimes by teachers, sometimes by employers, unfortunately 
sometimes by friends and family, that folks with disabilities 
cannot work and cannot build a financial future. Sometimes 
people with disabilities internalize this.
    Fortunately, removal of policy barriers can change this 
narrative. One such policy action was the ABLE Act in 2014, as 
mentioned earlier. We have seen firsthand how this has changed 
people's lives. People buy homes, they go back to school, they 
start small businesses.
    Particularly for folks with disabilities, who might have 
episodic or contractual work, we have seen that ABLE savings 
that, on average, that $8,000 per account allows people to 
navigate periods of unemployment, remain financially resilient 
through economic downturns and ultimately, improve their short-
and long-term financial outcomes.
    Unfortunately, as currently written, the ABLE account 
leaves out lots of people from being to access this tool and 
realize these benefits. Therefore, we strongly advocate for the 
passage of the ABLE Age Adjustment Act. Passing this will allow 
people with disabilities, with disability onset up to age 46, 
to open new accounts and expand the universe of ABLE accounts. 
We believe it will increase utilization of accounts and there 
are up to 6 million people who could benefit.
    In addition to that, we believe it strengthens the ABLE 
financial perspective and will create innovation within the 
ABLE space. In addition, it will allow older Americans who have 
become disabled by chronic illness, by accident, or by military 
service to benefit from this program as well.
    Members of this Committee, I started this testimony by 
talking about my American dream. I have achieved that. I bought 
the house, I have a solid retirement account. I put two-and-a-
half kids through college. I am not particularly special. 
People do not need to change, systems do.
    With your help, today, we can begin to change those systems 
and increase financial security and economic outcomes for 
people with disabilities.
    Thank you for the opportunity.
    The Chairman. Thank you, Mr. Foley, for your statement.
    Now we will turn to Mr. Brooks. Mr. Brooks, you may begin.

 STATEMENT OF RODNEY BROOKS, RETIREMENT COLUMNIST AND AUTHOR, 
                    SILVER SPRING, MARYLAND

    Mr. Brooks. Good morning, Chairman Casey, Ranking Member 
Scott and members of the Committee.
    My name is Rodney Brooks. I am a personal finance author 
and business journalist. I have written about retirement issues 
and wealth disparities for publications like U.S. News & World 
Report, the Washington Post, USA TODAY and National Geographic.
    I want to thank you for the opportunity to appear before 
you today to discuss some of the critical retirement issues 
faced by all Americans, especially some of the issues faced by 
older African Americans. Black women, in particular, face huge 
financial challenges as they age. You have all heard we are 
having a retirement crisis. That is because we are not saving 
enough to sustain ourselves when we retire. We all realize it 
and we worry about it.
    Forty-five percent of baby boomers said outliving their 
retirement savings is one of their greatest fears. There is 
good reason for that concern. Fifteen percent of Americans have 
no retirement savings at all.
    Today, we are living longer and thus, we need for our 
retirement savings to last longer. Today, a couple aged 62, the 
surviving spouse will probably live until 92.
    In the past we have had pensions that would provide 
financial resources for the rest of our lives. Our fathers and 
their fathers knew that their money would not run out and they 
would be taken care of. That is one of the reasons people 
worked for 25 or 30 years at one company. It was not just for 
the gold watch. It was to for the pension.
    Today pensions are largely a thing of the past. In 1975, 
pensions covered 40 million Americans. Today only 13 percent of 
non-union private sector workers are covered by pensions. That 
means pensions have been replaced by what I call do it yourself 
retirement plans such as 401(k)'s. I call it do it yourself 
because it puts the pressure on the workers. The workers have 
to figure out how much to save, what to invest in, and how to 
manage those investments.
    For older Americans, particularly Black women, the 
situation is more dire. Many older Americans have endured 
decades of discrimination, and as a result they have lower 
levels of education, income, and wealth.
    Additionally, Black Americans suffer disproportionally from 
eight of the top 13 causes of death in the United States. Black 
women have the lowest levels of income and wealth, which means 
that they need to continue to work as they age. Yet health 
problems can limit their ability to continue working.
    The impact of these economic inequities has resulted in 
multiple generations of poverty, and predictions from 
Prosperity Now that the average net worth of Black Americans 
will be zero by 2053 if nothing changes.
    These economic and health issues have been exacerbated by 
the COVID-19 pandemic.
    Fifty percent of Americans do not have retirement accounts 
largely because they work at small companies or they are part-
time and do not qualify.
    Some of the programs that may improve those numbers are 
one, auto-enrollment. When a new employee starts, the company 
automatically enrolls them in the plan. That has improved 
participation dramatically.
    Two, a number of states have started State savings plans 
and require companies to actually offer these plans to 
employees.
    Three, if companies, small companies had the option to join 
together to offer better plans it reduces the costs both the 
businesses and their employees.
    They are all complicated and interrelated issues with no 
single or simple solutions. If nothing is done, we are going to 
see more Americans, especially Americans of color, fall into 
poverty.
    I want to thank you again for the opportunity to provide 
testimony and for your interest. I will be happy to answer any 
questions the Committee may have.
    Thank you.
    The Chairman. Thank you, Mr. Brooks, for your statement.
    Dr. Badger, you may begin.

      STATEMENT OF JOSIE BADGER, Ph.D., CAMPAIGN MANAGER, 
             #IWANTOTWORK, NEW CASTLE, PENNSYLVANIA

    Dr. Badger. Thank you so much.
    Good morning. I would like to thank the Chairman, Ranking 
Member Scott for hosting this hearing and inviting me to speak. 
I would also like thank the Committee members for attending.
    This is an extremely important issue for the largest 
minority in America, or in your State, in fact.
    As you heard in my introduction, provided by Senator Casey, 
I have my doctorate and I am a business owner. I am also a 
homeowner, a partner, a daughter, a friend, and of course a dog 
mom.
    What you did not hear is that I am a person with a 
significant physical disability that I can say affects all 
areas of my life. I cannot put it into a category like I did 
with the other topics those are just elements of my identity. 
Having a disability affects my entire life and all parts of my 
being. It is the reason why I do not walk or breathe on my own, 
my need for 24-hour care, my relationships, my work, and even 
how I earn and save money.
    It does not affect the way I work, earn, or save money in 
the way that you might think it would. I work over 40 hours a 
week. I can do all elements of my jobs without accommodations 
from my employers. My disability forces me to stay poor and not 
save for those big steps that were mentioned earlier, the 
American dream, or retirement in general.
    When I was growing up, I dreamed of being a marine 
biologist. Long story short, I am on a ventilator. I do not 
swim. A change of plans ensued. I became a business owner.
    However, no one ever told me, quote/unquote, that's a great 
idea for you to be a marine biologist or a professor but you 
are not allowed to make that much money. No one told me to not 
work so hard in school, not to be valedictorian or not to get 
my degrees and pursue my dreams. That is exactly what the 
system is set up to do, to be prepared for success but not be 
able to actually achieve it, at least financially and 
stability-wise.
    As I was graduating with my doctorate, I was thinking, now 
what? I had spent years completing higher education, 
volunteering, and working part-time. Most of my peers were 
applying for fantastic jobs and comparing their offers about 
the best locations, opportunities, salary, and benefits while I 
was trying to figure out how to not be too successful.
    The reason I cannot be too successful is that I rely on 
government insurance programs such as Medicare and Medicaid for 
my survival. No private insurance will pay for the long-term 
supports and community-based services that I require to just 
get out of bed every day and to work in the first place. These 
amazing programs, however, have fairly strict income and asset 
limits. To be able to survive by having those services, I have 
to keep myself poor.
    To do so, I started a business so that I could salary but 
take job opportunities that I felt called to. Such a structure 
has allowed me to work while still receiving the medical care 
that could only otherwise be received through nursing home. If 
I did not get Medicare and Medicaid, I would be in a nursing 
home. This was only possible because I underpaid myself and did 
not have savings accounts or retirement.
    I can honestly say that it is more work to be able to work 
than the work itself.
    Some of the barriers to working and economic stability did 
change with the ABLE Account. That was the first opportunity I 
had to save more than $2,000 due to asset limits. In the past, 
I kept my income under those limits because I could not risk 
losing those life sustaining services.
    However, I opened an ABLE account because it seemed like a 
good thing to do and all the cool kids were doing it. I did it, 
too. At that point, I had no idea how useful it could be in my 
future.
    Then, during the pandemic, while I was in a small house 
renting with my partner and our two dogs and two cats, I 
realized how important having a space that I loved that was 
bigger really mattered, as I am sure maybe some of you 
realized, as well.
    I decided that it was time to buy a home. I knew that I 
could easily pay the monthly mortgage payments, but I did not 
have even close to what I needed set aside for a down payment. 
That is where ABLE came into play for me. It made home 
ownership possible.
    Through the little bit of savings that I had put into 
accounts and a gift, I was able to purchase my home a year ago 
today actually--yesterday. According to Facebook, yesterday.
    This was only possible because of the ABLE savings 
accounts. It is a wonderful program, but as it has been 
mentioned, the strict age criteria with it being that you have 
to acquire your disability before the age of 26, really limits 
the number of people that can receive this type of account. We 
need to fix that problem. We need to address an even bigger 
issue: the limitations on earning money. The Substantial 
Gainful Activity Limit, SGA for short, restricts how much money 
a person receiving Social Security Disability Insurance can 
earn a month. There are similar limits for SSI, Medicare and 
Medicaid.
    For SSDI, the limit is currently $1,310 per person. That is 
$1,500 less than the Federal poverty limit for a one-person 
household. Earning more than SGA means the possibility of 
losing life-sustaining medical and health care coverage in 
addition to the case benefits.
    Because of such policies people with disabilities, 
including me, we are capping our employments and earnings and 
ultimately our opportunities. It limits our success in order to 
just make sure that we are receiving life preserving and 
sustaining care.
    At one point in time, the asset and income limits probably 
made a lot of sense. No taxpayer wants to be giving money to 
people who do not need it. However, with medical advancements, 
assistive technology, workplace accommodations, and actually 
changes in the work world and fields, these restrictions are 
actually restricting individuals from pursuing opportunities.
    People like myself, who receive and require a high level of 
support and medical care, would not have survived previously 
without these advancements let alone be able to work in 
previous decades. Now not only are we surviving, but we are 
capable of thriving.
    Thank you so much.
    The Chairman. Doctor, thanks very much. I just want to make 
sure we can move through our witnesses.
    The fourth and final witness is John Iacofano, and he will 
provide his testimony and then we will get to questions.

 STATEMENT OF JOHN IACOFANO, OWNER, IACOFANO'S CATERING, MOUNT 
                    PLEASANT, SOUTH CAROLINA

    Mr. Iacofano. Thank you. Good morning, Chairman Casey, 
Ranking Member Scott, and members of the Committee.
    My name is John Iacofano and I am the owner of Iacofano's 
Catering in Mount Pleasant, South Carolina.
    Twenty years ago, as a struggling student with $90 to my 
name, I painted a building to get the down payment for a 300 
square foot space to start my catering business. Iacofano's 
began by preparing deli trays for corporate groups and later 
opened three restaurants.
    Today, Iacofano's provides catering and food services to 
corporate events, weddings, in-flight catering, senior living 
facilities, and meal service for non-profits such as Meals on 
Wheels. We have 85 employees and six locations across the 
country, including Charleston and Columbia, South Carolina; 
Charlotte, North Carolina; West Deptford, New Jersey, a suburb 
of suburban Philadelphia; Cleveland, Ohio; and Denver, 
Colorado. Our average employee age is 45, with the oldest being 
78.
    During the pandemic we were able to maintain a workforce 
and add additional quality employees from large corporate 
layoffs. As large corporations began to rehire, we were unable 
to keep up with the benefits they offered, specifically 
retirement plans. We lost one of our best employees when her 
former employer, an international catering company, offered to 
reinState her benefits. We offered her over 11 percent more pay 
plus success sharing checks but she went back with her former 
employer for one simple reason, the bigger firm offered her a 
retirement plan.
    My small business attempted many times to implement our own 
employee retirement plan but were shut down by the excessive 
fees along with plan liabilities and administrative burdens my 
team could not handle.
    At Iacofano's we are on a mission to cover the entire 
circle of life for our employees: from health care, competitive 
pay, vacation, and more. However, the number one inquiry 
candidates and employees ask is, ``do you have a retirement 
plan?''
    Just a few months ago, Matt Watson at NFP approached me 
with a possible solution to our retirement plan struggles. The 
SECURE Act had passed through Congress and established Pooled 
Employer Plans (PEPs), allowing unrelated employers to join 
together to provide workplace retirement savings options 
without some of the costs, administrative burdens, and 
liability attached to sponsoring a plan on their own. One month 
later we are on a conference call setting up our plan and 2 
months later we are launching our first employee retirement 
plan at Iacofano's.
    The new PEP system is a plug-n-play plan that links 
directly to our payroll system at a low cost of $2,600 per year 
broken into quarterly payments. Our plan provider offers 
educational classes to our team; and handles all employee 
enrollment, legal requirements, and administrative work. These 
cost and administrative savings are the sole reason we are now 
able to offer our employees retirement benefits. Plus, these 
low costs allow us to offer a very competitive match. These are 
new dollars going into the paychecks of our valuable team 
members.
    Chairman Casey, Ranking Member Scott, and members of the 
Committee, I am thrilled to announce that as of today our 
employee retirement plan is open for enrollment. For the 
majority of my employees this is the first workplace retirement 
plan ever.
    On a personal note, my father was a small business owner. 
He passed away and the business was closed. My mother, as a 
stay-at-home mother for 30 years, had to reintroduce herself 
into the workforce. Now, at 78 years of age, her current 
retirement plan includes $1,450 from Social Security and only 
$270 from a large company that she had worked for over 10 
years. Had access and education of the PEP plan been available 
to my family, my mother would not have to be working full time 
to make ends meet in retirement.
    The PEP is going to help my employees engage in the 
retirement that they once thought they were destined to have.
    Our next goal is to continue to grow the diversity of 
employees within our company. We are fortunate to work with 
Babcock Centers in Columbia, South Carolina, an Adult with 
Disabilities Empowerment Organization. Babcock approached us 
over 2 years ago asking if we were willing to bring on one or 
two of their clients to work in our facility. With the help of 
a Babcock representative, we hired a gentleman named Jay. Jay 
continues to work for us and is a vital part of our team. If it 
had not been for our services providing meals to the Babcock 
Center, we would have never known about the opportunities to 
hire adults with disabilities.
    Small businesses need more information and availability to 
hire, train, and provide these new opportunities for adults 
with disabilities. This, along with the new PEP plan, will only 
help small businesses like mine become competitive employers 
and take care of the entire circle of life of their employees.
    I would be happy to help this Committee in any way possible 
to get the word out to small businesses.
    Thank you for your time and I am happy to answer any 
questions you that may have.
    Thank you.
    The Chairman. Thank you for your testimony.
    I want to make sure that I am correct about something. I 
have pronounced your name more than once now and I want to make 
sure I am pronouncing it correctly. I put the emphasis on 
``ick-ofano'' and I thought I heard you say--I want to make 
sure I am right--more like ``I-cofano''.
    Mr. Iacofano. Yes, so it would be like ``ya-cofano'' 
really, but we have been--it is ``I-cofano''. We say ``I--
cofano.''
    The Chairman. Okay, I will try to
    Mr. Iacofano. Iacofano. That is okay. You are not the first 
person to butcher our last name. You will not be the last, I am 
sure.
    Senator Tim Scott. I was wondering the same thing about 
``ick'' or ``ike''. He just entered another element though, so 
we are going to be here for a long time.
    The Chairman. Well, we are grateful
    Mr. Iacofano. I am not going to say ``ick'', ``ick'' in 
catering would not be a good introduction.
    Senator Tim Scott. Yes, icky. We will go with ``ike''.
    The Chairman. I think we have to give you extra time 
because of that question I just asked you, but thanks so much.
    We will turn to our questions. I wanted to start with Dr. 
Badger. Doctor, I wanted to thank you for sharing your story, 
which is both a story about the challenges you have faced, but 
also a story of real inspiration, what you have had to 
overcome, to open a business and to buy a home and to do so 
many other things that you have related today.
    In your testimony, you talked about how ABLE was your first 
opportunity to save more than $2,000 due to asset limits for 
Medicaid. You also said you had not really put much thought 
into long-term savings since you had never had the opportunity 
to save before. As you put it, the way the system is set up, 
you said it was set up ``to be prepared to be successful but 
not to actually be permitted to achieve success, at least 
financial success and stability.''
    That is a powerful statement and, I think, emblematic of 
what we are wrestling with here.
    You said that it was the COVID-19 pandemic that motivated 
you to start saving with a goal in mind. Were is my question: 
how did an ABLE account, in your case, help you to level the 
playing field for people with disabilities in your case, but 
more broadly for people with disabilities who can access them?
    Dr. Badger. Thank you so much for the question. Yes, I 
believe that ABLE is one of the fundamental areas that will 
allow people to be more successful. For me, it was home 
ownership and I hopefully will continue to use it to pay off 
that monthly mortgage of mine.
    I think for other individuals there has been a long-
standing concern and teaching from the system that you, as a 
person with a disability, cannot have money. I know a lot of 
individuals who are my age and younger who are putting money 
under their mattresses or only working in cash which, when I 
was redoing our house, we found money in our ceiling. We are 
reverting back into acts that were done during the Great 
Depression of saving money when possible. The bigger issue is 
not having money to save in the first place. I think that is 
the next step beyond allowing more people to earn, save, and 
know that they are not going to lose life sustaining care to do 
so.
    The Chairman. That is very helpful, to have you walk 
through your own personal experience.
    Speaking with people with personal experiences, I want to 
turn to Mr. Foley. We heard, as I just mentioned from Dr. 
Badger, that her ABLE account, what it means to her and so many 
in the disability community. One of the real limitations, one 
of the problems we are trying to solve with the legislation, is 
the 26-year-old limitation. Meaning that the accounts are only 
open to people who have had a disability before their 26th 
birthday.
    Can you explain why the original ABLE act included the age 
limit, which we now want to change, and why it is important to 
expand ABLE accounts?
    Mr. Foley. Thank you, Senator.
    Yes, so the changing it to disability onset before age 26 
was kind of a last minute accommodation made back in 2014 from 
a scoring perspective for the bill. The entire time folks were 
advocating for it and talking about it, a much larger group of 
people had been envisioned. It was mostly for scoring purposes.
    To the second part of your question, you know, we estimate 
that there are as many as 6 million people who would be newly 
eligible if the ABLE Age Adjustment Act happened. Those are 
people whose--obviously, their disability happened after age 
26. Maybe that was an accident. Maybe that was an illness 
picked up later in life or someone from military service.
    Having worked in this space for quite a while, it is really 
difficult to meet a 27-year-old who is recently spinal cord 
injured and tell them there is this great product out there but 
it is not for you. Or someone coming back from a tour of duty 
who has been injured fighting for this country and telling him 
or her that ABLE is not for them.
    There are 1 million veterans that could be eligible for 
ABLE and it is imperative that ABLE be extended to be able to 
be a benefit from a financial standpoint, from a support 
standpoint, and from a long-term economic development 
standpoint for those individuals.
    The Chairman. Mr. Foley, thanks very much. I will turn to 
Ranking Member Scott for his questions.
    Senator Tim Scott. Thank you, Mr. Chairman. I understand 
that Senator Lee is available now for questions, and I am happy 
to defer to Senator Lee if he is still available for questions 
now and I will take the second round.
    The Chairman. Senator Lee.
    Senator Tim Scott. Sounds good.
    Mr. Iacofano, a quick question for you. I know that the 
SECURE Act provided you with an opportunity to start your 
retirement account today and congratulations. As a former small 
business owner myself, I understand and appreciate the 
excitement that when you are able to offer new benefits for 
that extended family, as I discussed in my opening comments, it 
really is heartwarming for you and certainly good for your 
employees.
    I know that there are several parts or aspects of the 
SECURE Act that can be helpful, whether it is reducing the 
price or helping to cover the liability exposure. Which of the 
two, or other aspects of the SECURE Act, help you start your 
retirement account today?
    Mr. Iacofano. There is multiple aspects. One major one is 
obviously $2,600 a year is the cost to me, broken apart in 
quarterly payments which is huge.
    Then you have the administrative, the fiduciary, the entire 
liability basically is being handled by the plan itself where 
with the old plan, before you guys put this new SECURE Act 
through, the old plan had the ``one bad apple'' part of it.
    Everybody could be liable in the plan. This got rid of 
that, which is excellent. The new plan helped to do that.
    The two, the liability and the very low cost of $2,600.
    Senator Tim Scott. During your opening comments, you made a 
statement that caught my attention and I want to ask you a 
question and give you a little more time to expound on the 
importance of the competitive advantage that comes with the 
ability to offer retirement programs to your employees. You 
talked about losing a key employee, or at least an important 
employee, because they were able to have a retirement system. 
They turned down an 11 percent wage increase in order to have 
an opportunity to secure resources in retirement.
    How important is having something like the SECURE Act in 
place and you launching your own retirement plan in retaining 
your best and brightest employees?
    Mr. Iacofano. It is--I will not be competitive if I do not 
offer retirement. This allows me to not only offer retirement, 
become competitive, be able to obtain new team members. Due to 
the low cost, it also allows me to match. We will be matching 
100 percent on the first 3 percent and 50 percent on 4 and 5 
percent, which makes me extremely competitive against very 
large corporations and puts us on the same level.
    Senator Tim Scott. Mr. Iacofano, I would say that you are 
doing better than most corporations. One hundred percent on the 
first 3 percent is pretty remarkable. That is fantastic.
    Mr. Iacofano. Thank you.
    Senator Tim Scott. It tells me that you care about your 
employees.
    Mr. Iacofano. Well, it is the low cost. It is the low cost.
    Senator Tim Scott. That is fantastic. It allows you to 
transfer those resources or the benefits to your employees 
through the additional matching opportunities. That is good, 
that is being a good employer and something that we should all 
celebrate.
    You also do something else that I think is really important 
to the workplace and very important to maximizing human 
flourishing. You look for ways to hire folks who are very 
talented, who might have varying skill sets, different talents, 
but also different challenges to coming to the workforce. I 
know that you have done a good job of offering opportunities to 
folks with disabilities.
    How can we encourage more companies to follow your path in 
recruiting and retaining vital workforce talent to include 
those folks with special needs or disabilities?
    Mr. Iacofano. Well, I was fortunate enough to work with 
Babcock Center or else I would not have even known that there 
was such a thing as employing adults with disabilities, nor 
would I even know the need for it.
    We have very talented workers out there that need jobs. I 
believe in South Carolina alone and in Pennsylvania the 
unemployment rate for adults with disabilities, in Pennsylvania 
I believe it is 61 percent and South Carolina is about 67 
percent. Transportation is a huge need. Jay, who is an adult 
with disability and been with us for over two years, we pick 
him up and drop him off to--pick him up from home and drop him 
off at home every day. Transportation is huge.
    How can we create the space or what needs do the adults 
with disabilities have in the workforce? Whether it is special 
equipment, whether it is the ride to work. What do they need to 
get to work and be able to be successful at work is the 
question. I believe that is where our resources can go.
    Senator Tim Scott. Thank you, Mr. Iacofano.
    With my last 30 or 40 seconds, Mr. Brooks, I would like to 
ask you a question about retirement portability. Said simply, 
when you have a small retirement account, $5,000 or $6,000 and 
you change jobs, oftentimes what happens is what we call 
leakage. You just take that money that is in your retirement 
account and you cash it out. You pay a penalty. You have to 
claim it as ordinary income. Those retirement dollars are gone.
    I worked with the DOL and a guy named Bob Johnson to help 
create the framework for auto portability between retirement 
plans. How important is this reform for those living in the 
underserved communities? How can we continue this progress?
    Mr. Brooks. Yes, I think portability is critical. As you 
said, people cash out their plans, especially if they have a 
small amount. Part of it is the company's do not encourage you 
to merge them.
    I think what might help that is some financial education 
because most of the people who--many of the people who cash out 
are low-income or young. I do not think they realize the tax 
implications when they do cash out until they have to file 
their tax returns.
    Senator Tim Scott. Then it is a big surprise.
    Mr. Brooks. Yes, a big surprise.
    Senator Tim Scott. Thank you, Mr. Brooks. Thank you, Mr. 
Chairman.
    The Chairman. Thank you, Ranking Member Scott.
    We will turn next to Senator Kelly.
    Senator Kelly. Thank you, Mr. Chairman.
    I want to followup on a couple of Senator Scott's 
questions. This question is for Dr. Badger.
    Dr. Badger, Employment First is a framework that seeks to 
make integrated employment the goal and priority for states and 
public systems. In 2017, Governor Ducey, the Governor of 
Arizona, signed an executive order declaring Arizona an 
Employment First State, which required state agencies to 
partner with outside vendors to improve job opportunities for 
people with a disability. Stakeholders across the State worked 
collaboratively to make this happen.
    Arizona is one of many states working on this, and it is a 
priority for the Federal Department of Labor. Could you 
describe some successes that you have seen that more states 
should try to emulate?
    Dr. Badger. Absolutely. Thank you so much for that 
question.
    I was part of--through the #IWantToWork campaign we worked 
to establish our Employment First legislation. I think what we 
are seeing, and it is really trend based, is that states that 
have had Employment First specifically legislation and 
executive directives, they are having progressively more 
individuals with disabilities who are employed. I think that if 
you start looking at the numbers, and there was a recent report 
put out by ACL, 30 Years of Living, you will see that the 
states that have had those pieces of legislation on the books 
longest have the highest employment rates. I think we need to 
look at the data to show the success.
    Senator Kelly. Beyond the legislation that is already on 
the books, what are the top one or two ideas to continue to 
increase the employment rate for adults with disabilities?
    Dr. Badger. I think going forward we are looking at making 
sure that that mindset of Employment First, making sure that 
competitive integrative employment is the mindset that we hope 
for all individuals, starting with IEPs in high school, is key, 
and endorsing that as a State. Also, really working on the 
collaborative efforts that you mentioned to make sure that our 
policies and actions in the country, State and locally truly 
support that employment work of people with disabilities.
    Senator Kelly. Thank you, Dr. Badger.
    Dr. Badger. Thank you.
    Senator Kelly. Mr. Foley. Mr. Foley, your testimony 
mentioned the increased likelihood that individuals with 
disabilities would be underbanked. We know that asset and 
income limits make saving complicated. I am also curious about 
access to credit.
    Could you describe what the challenges are for gaining 
access to credit and building credit over a lifetime for adults 
with disabilities?
    Mr. Foley. Absolutely, thank you for the question.
    We have done research that indicates that folks with 
disabilities are two to three times less likely to have access 
to the credit they need than the general population. This goes 
along, I think generally, with the information about being 
underbanked.
    Basically, people with disabilities would benefit greatly 
from financial education, financial counseling, credit 
education, and credit counseling. Many of the financial 
education curriculums out there and credit bureaus are more and 
more doing a lot of work to try to reach low--and moderate-
income communities and we work closely with several of them to 
make sure that people with disabilities are included in that 
work.
    Many people with disabilities are also what is known as 
credit invisible. You know, if you do not have a bank account 
and you are not working, there are not a lot of accounts or 
credit bureaus to pull from. I know the industry is working on 
new models to help alleviate these issues. It is definitely a 
concern with regard to credit access to folks with 
disabilities.
    Senator Kelly. Mr. Foley, do the credit agencies use any 
different standards for individuals with disabilities?
    Mr. Foley. You know, I would certainly, you know, from an 
income standpoint, SSI and SSDI qualifies as income. I do know 
that from a scorer's perspective, medical debt has begun to be 
treated differently in recent years with regard to its impact 
on credit scores.
    I guess the short answer to that is yes, to some extent, 
but there is still more work to be done.
    Senator Kelly. All right, thank you, Mr. Foley. Thank you, 
Dr. Badger.
    The Chairman. Senator Kelly, thanks very much. Now we will 
turn to Senator Lee, who is joining us virtually.
    Senator Lee. Thank you, Mr. Chairman.
    Savings and investments enable us to serve our respective 
communities and increase our future capacity to afford 
necessities. Financial capital, in fact, underpins social 
capital. Savings allow us to form and expand families and to 
surround ourselves with neighbors and institutions that enrich 
our lives.
    Savings make retirement possible, which provides us with 
the opportunity to invest ourselves and our time more deeply in 
our communities.
    Mr. Iacofano, what are some of the ways in which empowering 
your employees with the opportunity to save for retirement 
might have a trickle-down effect that benefits other members of 
the community in the Mount Pleasant area? For example, do you 
think that making retirement savings possible for your 
employees allows them to invest their time and their resources 
more fully in their communities?
    Mr. Iacofano. Well, you are talking about having to have 
people unprepared for retirement and having to work, going to 
work all the way until your 70's and your 80's because Social 
Security is not going to give you the full retirement that you 
need. Therefore, in the community, are you able to be part of 
your community more? Are you able to donate time to your 
community? Or are you going to be working 50, 60 hours a week 
when you are 70, 80 years old?
    Really, right? As you age, you start to donate more time 
and resources and knowledge to your community. Are we going to 
have the ability for our aging population to do that, is the 
question? I would say no.
    Senator Lee. Thank you.
    In 2019, Congress passed legislation that created Pooled 
Employer Plans to provide businesses with more flexibility in 
how they can band together with other businesses to offer 
retirement plans to their employees. I have heard from Utah 
companies and Utahans seeking to save for retirement, that this 
has been a great benefit for them.
    Mr. Iacofano, you mentioned in your testimony that the 
ability to provide these Pooled Employer Plans, or PEPs, to 
your employees will change the retirement that they once 
thought they were entitled to have. How have these plans 
benefited your employees? Are there any additional barriers 
that you face as you seek to create opportunities for your 
employees to achieve their retirement and the kind of 
retirement they desire?
    Mr. Iacofano. The biggest barrier is knowledge and 
understanding of how important it is, right? When you are 20, 
30, maybe in your 40's, you are not even thinking about 
retirement. You are not thinking, that is way off in the 
future. By starting this plan, it forces my company to educate 
all levels, all age levels of employee within the company and 
it begins to focus on the retirement. With the match, with the 
PEP and the SECURE Act being put in, it allows me, due to its 
being so low cost, allows me to match.
    What that is going to do is really, as any employee, you 
should be donating 5 percent of your wages because we are going 
to be matching 4 percent. Now you are putting 9 percent away 
toward retirement. Whether you do that 401(k) or Roth is up to 
you. Nine percent will be put away and you are donating 5 and 
we are giving you 4. This is allowing us to educate what 
typically somebody would not be paying attention to.
    Senator Lee. Thank you, that is helpful.
    Mr. Brooks, you mentioned in your testimony that under the 
majority of today's retirement plans the responsibility falls 
on the individuals to figure out how much to save, in what to 
invest, and how to manage their investments. What is your 
assessment, Mr. Brooks, of the financial literacy of Americans 
when it comes to retirement savings? Is there better financial 
literacy for some types of retirement savings accounts than for 
others?
    Mr. Brooks. Well, financial literacy as a whole, there are 
more courses offered--actually mandatory courses--at the high 
school level where I think they have to start. Not that many. 
When it comes to financial literacy as a whole, I think we are 
pretty weak.
    Now there are companies who, along with their plans, offer 
some sort of support. My experience has been that many do not.
    When I say employees are left to themselves, they can call 
possibly an 800 number but at one time human resources 
companies--I am sorry, human resources departments offered that 
kind of assistance. Now companies have cut back so that is not 
available anymore.
    Senator Lee. Thank you.
    Thank you, Mr. Chairman. I see my time has expired.
    The Chairman. Senator Lee, thanks very much.
    I want to acknowledge some Senators who joined our hearing, 
Senator Rick Scott, as well as Senator Warnock. I know we are 
awaiting some other Senators to arrive. In the interim, I will 
start with another question. If other Senators arrive, I will 
cut myself off.
    I wanted to turn to Mr. Rodney Brooks. Mr. Brooks, you 
examined the real world impact of retirement policy on people 
working hard to save for their future. Many proposals that have 
been discussed today have looked at ways to improve retirement 
accounts for people who already have access. We have also heard 
form people who face steep barriers to long-term and stable 
employment or career advancement, which would provide them 
access to retirement accounts. Unfortunately, we know that 
communities of color and people with disabilities are more 
severely impacted by these issues.
    I am ask you kind of a question that you made reference to 
in your opening but I wanted to reiterate some of it. What 
steps need to be taken to increase long-term savings for those 
who have traditionally struggled to access stable retirement 
accounts, such as those holding multiple jobs or facing 
difficulty holding a job long-term?
    Mr. Brooks. One option, I think, is the State savings plans 
that are being offered. I think a dozen states are offering it. 
Again, those are offered through, mostly through employers.
    One option might be a baby bonds type program that has been 
proposed by economist William Darity and in legislation 
proposed by Senator Booker that would basically provide say 
$1,000 to a baby born anywhere. The amount depends on the 
income of the parents. By the time they are 18, they will have 
some income to invest for either college education or to buy a 
house.
    Morningstar basically said a baby bond program would cut 
the racial wealth gap in half.
    The Chairman. Thank you very much. I appreciate you 
bringing your experience to bear in providing suggestions for 
steps we can take.
    I want to turn next to Dr. Badger and Mr. Foley, maybe a 
kind of a joint answer or a question for both, depending on who 
wants to take it first. You have both worked over the years to 
improve economic access for people with disabilities and you 
both have personal experience with some of these challenges we 
have talked about.
    Mr. Foley, your work at the national level and, Dr. Badger, 
your work in Pennsylvania have given you important perspectives 
in this work not only professionally but personally.
    Mr. Foley, in your testimony, you put it simply. You said 
``Asset and income limits discourage savings, work, and hope.'' 
You have both discussed, both Dr. Badger and Mr. Foley have 
both discussed the asset limit for Federal benefits and how 
ABLE accounts have helped to address part of that issue or part 
of that problem but other challenges remain.
    Maybe we will start with Dr. Badger because I know you made 
reference to some of these issues when I was calling the time 
or cutting you off for time. What are the one or two other 
actions that you think we need to take to make it possible for 
more people with disabilities to obtain jobs and be able to 
plan for their economic future? I will go with Dr. Badger, I 
will give Pennsylvania priority here, and then Mr. Foley.
    Dr. Badger. Thank you, Senator.
    I think that we need to look at other options allowing 
people to earn more. I think some of that is expanding the 
Medicaid buy-in for workers with disabilities. In Pennsylvania 
it is called MAWD, Medical Assistance for Workers with 
Disabilities.
    The other part is we need to start looking at these issues 
such as retirements. At this point, those of us who require 
medical assistance, Medicaid or Medicare, or cash benefits 
cannot have liquid savings accounts. We cannot have retirement 
that can be liquidated. We need to start looking at different 
savings plans that can be permissible that would allow us to 
retire.
    ABLE is wonderful and they are still saying it will take 
about $1 million to retire comfortable, and that is not even 
close to what we can save.
    Thank you.
    The Chairman. Thanks very much. Mr. Foley.
    Mr. Foley. Thank you, Senator.
    Yes, Medicaid buy-in programs and, you know, I would like 
to put out the idea of a national Medicaid buy-in program that 
met certain criteria that was portable would certainly go a 
long way to helping people with disabilities seize new 
opportunities outside of a State that they might be currently 
working in.
    I still think ABLE Age Adjustment Act is a huge piece of 
what we have seen drives savings, drives work, drives small 
business development.
    I will circle back to that original quote. We are telling 
18-year-old kids with disabilities not to save, not to work. 
Even if you do, you will not be able to save your money. We 
have got to do something about that $2,000 asset limit because 
those are the formative years. You know, that first job, that 
second job where you learn a work ethic, you learn that you can 
save money to buy baseball tickets or go out to eat or whatever 
are just really, really important for building long-term stable 
employment.
    Without those experiences, without those learnings, you 
know, a lot of people with disabilities will not be able to 
build that career, build that retirement account and purchase a 
house. I think we definitely have to do something about that 
$2,000 asset limit, as well.
    The Chairman. Thanks very much.
    I will turn next to Senator Braun and then, after that, 
Ranking Member Scott if you want to start another round.
    Senator Braun, who I think is joining us virtually.
    Senator Braun. Yes, thank you, Chairman Casey.
    My question here in a moment is going to be related to not 
building wealth in the sense of retirement plans and so forth. 
It is going to be preserving wealth. Being a business owner, I 
found it easier to put together--especially when you get to a 
certain size--good retirement plans. The real wrestling match 
and the depleter of wealth in many cases is the wrestling match 
you have with the health care system.
    My question is for Mr. Iacofano, in the sense that I know 
he used the concept of pooling, allowing smaller businesses and 
entities to pool together to get some of the benefits that you 
get in any case where you align forces, you kind of increase 
your bargaining power.
    I am concerned that whatever you do there, as you are 
running a company, you still have the biggest challenge for 
your company and your employees, and it is our broken health 
care system. Thirteen years ago I took it on when I had 300 
employees, just large enough to where you did not need to pool 
to get the benefits that were largely not there for companies 
my size.
    I am interested in seeing what your issues have been with 
health care because I think it is very analogous and I think it 
is the biggest depleter of wealth because of the costs and the 
fact that, in my case, I was able to freeze health care costs, 
make my employees engaged consumer focusing on avoiding the 
system, paying for 100 percent of wellness, but getting them to 
be in unison with me to take on a challenge that now has--
unlike many other companies--become something that is not as 
dominating as it used to be.
    Mr. Iacofano, I would be interested to hear your challenges 
with health care. Do you think pooling and associating by being 
able to team up with other companies your size would be a 
beneficial tool? The health care industry makes it tough to do. 
Let me know your thoughts on health care as being analogous to 
what you did with retirement.
    Mr. Iacofano. Thank you, Senator Braun. This is--I do not 
know that we have enough time for this discussion. Every year 
it is a challenge for me to just keep my health care. I do not 
have enough participation, yet we pay approximately over 76 
percent of the health care costs for our team members. Every 
year I have to increase the cost, the deductibles, and 
everything just to--and the cost of the health care goes up. 
The deductibles go up, the health care goes up. I try to take 
on more of the burden. I cannot get the--the importance of 
health care, the education of the importance of health care is 
very difficult as well for employees to understand especially 
depending on the age, whether somebody needs health care.
    To do a pooled employer plan would be unbelievable. A a 
matter of fact, I am from Cleveland originally. When my father 
was a small business owner, Cleveland had something like that. 
We only had three or four employees but we benefited at the 
time. I cannot remember the name of it but I know we benefited 
at the time from that pooled employer health care plan that was 
provided. It was some type of business group that was together.
    That would be unbelievable. Every year, I a sweating 
whether or not we are going to be able to even provide 
insurance for our team.
    Senator Braun. For you and anyone else listening out there 
today, I have dropped a bill called the Fair Care Act, which is 
the most comprehensive approach to what you could do here in 
the Federal Government to make it consumer driven, embrace 
transparency, embrace competition. The industry runs like an 
unregulated utility in that they disguise themselves as being 
free enterprise with none of the characteristics.
    I think that we need to pay attention to that because 
regardless of what you do on retirement and keeping your bottom 
line healthy, it is like a tapeworm on your business--and I 
think Warren Buffet coined that term.
    I would be happy to reengage with you where we have more 
time. Anyone else listening out there, get a hold of my office 
if you want to see what we can do for the Federal Government. 
Sadly, the clout of pharma, of hospitals, providers and 
insurance is so heavy that most Democrats who bring health care 
as the most important issue there run into issues where they 
are not willing to reform the industry before they want more 
government involved with it.
    I think you need to do the reform first before you tackle 
how government gets more involved with it. For you and any 
other small businesses out there, reach out to our office. I 
will share with you what I did in my own company to keep health 
care costs flat and to where my employees are healthier and 
spend less on health care now than they did 13 years ago.
    I think my time is up and that is a lot to digest. Thanks 
for taking the question. Let's reengage down the road.
    The Chairman. Thanks, Senator Braun.
    I will turn to our ranking member, Senator Scott.
    Senator Tim Scott. Thank you, Mr. Chairman.
    I would like to talk to Mr. Brooks about the importance of 
financial literacy for some portion of my time. It is important 
for us to recognize that financial literacy is critically 
important. We should start the conversation not when we are in 
our 50's or early 60's, but in our 20's. Frankly, even in high 
school it would be importance for us to have that engagement. 
As we know the magic of compounding interest takes time. If we 
have time it is miraculous, comparatively speaking, than 
starting your conversation about retirement in your 40's.
    Mr. Brooks, would you like to weigh in on the importance of 
starting early in the financial education and then starting 
early with investing in your own retirement?
    Mr. Brooks. Sure.
    As I mentioned before, a good first step would be some sort 
of requirement of financial literacy courses in high school. 
There has been some good success for some programs that have 
actually started before high school.
    One of the advantages of a program with financial education 
for people in elementary school, for instance--and there are 
some like Ariel Academy in Chicago--is that in addition to 
teaching the kids, they teach the parents, as well.
    I think the biggest help would be requiring, basically 
making a financial literacy course a requirement in high 
schools, and maybe even junior high schools.
    Now as people get older, it is harder but it is still 
important. I think using people going into community centers, 
senior centers, I think all of that is useful.
    Now we are actually seeing professional athletes basically 
take on the cause.
    I think that can make a big impact with young people.
    Senator Tim Scott. Thank you, Mr. Brooks.
    I know that a few years ago, Chairman, I started something 
called Financial Football where we partnered with the NFL and 
Visa to bring a Madden-type game of football to high schools 
throughout the country. Specifically, we started at home in 
South Carolina at my alma mater Stall High School. We literally 
had teams playing against each other, students joining teams. 
We brought in a couple of Carolina Panthers to coach the team 
so that we could have a conversation and a debate around issues 
of savings and retirement and investments like mutual funds 
versus individual stocks and derivatives.
    The more complicated the question the more yards you gained 
or the pass was like a hail Mary. That turned out to be a lot 
of fun. If we could find a way to make financial literacy a 
little more engaging, financial education a little more 
interesting for some of the young folks in 8th and 9th grade, 
we might find ourselves having a better future for those young 
folks when they are entering into the retirement years.
    I will close with this comment. When I was selling 
financial plans and some retirement plans, I would say to the 
folks I was talking to that a 19-year-old that saves $100 a 
month at 12 percent interest will likely have more money than 
the 45-year-old that saves $1,000 a month at the same interest 
when they hit age 65.
    The Chairman. That is remarkable.
    Well, Ranking Member Scott, thank you for those questions. 
We are approaching the end of our time so I wanted to provide a 
closing statement and then I will turn to Ranking Member Scott.
    As we heard today, millions of Americans face barriers to 
achieving economic independence and a secure retirement. People 
with disabilities and communities of color face unique and 
overlapping challenges. Federal asset limits make it easier for 
people with disabilities to keep their incomes low than to 
build long-term savings accounts or build a long-term saving 
account. Workplace biases keep both people with disabilities 
and communities of color in lower paying and sometimes in 
multiple low-paying jobs.
    These challenges are building up over lifetimes and across 
generations, making the dream of retirement almost impossible 
to achieve for so many.
    We must find ways to eliminate the employment gap and the 
wage gap faced by people with disabilities and folks in 
communities of color. Passing legislation like the ABLE Age 
Adjustment Act, Senate Bill 331, will provide millions of 
Americans with disabilities, including over 1 million veterans, 
a pathway to savings.
    I look forward to working with all of my colleagues to 
advance this critical legislation and other policies that we 
have heard about today to address these issues. I want to 
thank, in particular, Ranking Member Scott for his own 
perspective on this and his ideas and for bringing his own 
personal experience to bear on these issues.
    Ranking Member Scott, I turn to you.
    Senator Rick Scott. Thank you, Mr. Chairman. Thank you once 
again for holding a very important hearing that so many 
Americans, especially folks in their golden years and people 
with disabilities, will learn important information as they 
watch this over and over again, I am sure. This is an important 
hearing about an important topic that will have an impact 
positively or negatively on retirement years for so many folks.
    It is my heart that we can do better. We can do better in 
educating and informing the public about the importance of 
starting early. We can do better about informing the public 
about good legislation that has been passed, whether it is the 
one that you have been talking about or the SECURE Act.
    It is really importance for us to look at strong business 
owners like John Iacofano, who started his retirement plan for 
his employees today with 100 percent match. The more education 
we have, the better off people will be and the more we will 
enjoy those golden years.
    I want to thank Neri, my staff director, as well as my 
staff and Ben Hobbs who helped put this together for us today. 
Nothing happens by yourself. Nothing happens in a vacuum. We 
are really blessed to be surrounded with really highly educated 
individuals that are motivated to make sure that every single 
American has a better chance in retirement than they did before 
this hearing. Thank you for your hard work and I look forward 
to our next hearing.
    The Chairman. Ranking Member Scott, thanks very much.
    I want to reiterate what you said about our staffs. We are 
lucky. Stacy Sanders, who is over my left shoulder here, 
certainly fits that description of someone who works with her 
team to make these hearings informative and make it possible 
for us to have a hearing like we have had today.
    Senator Tim Scott. Mr. Chairman, I did mean to mention my 
other staff who is behind me as well, Sarah.
    The Chairman. I appreciate that. Thanks.
    If any Senators have additional questions for the witnesses 
or statements to be added, the hearing record will be kept open 
for 7 days until next Thursday, July 22nd.
    Again, I want to thank our witnesses for bringing their 
testimony today and making themselves available and especially 
bringing their expertise to bear, both personal and 
professional, on these issues that confront so many 
communities.
    Thank you all for participating today. This concludes our 
hearing.
    [Whereupon, at 11 a.m., the Committee was adjourned.]  
      
      
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                                APPENDIX
      
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                      Prepared Witness Statements

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