[Senate Hearing 117-145]
[From the U.S. Government Publishing Office]
S. Hrg. 117-145
FINANCIAL LITERACY:
ADDRESSING THE UNIQUE JUST-IN-TIME
DECISIONS OLDER AMERICANS AND
PEOPLE WITH DISABILITIES FACE
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HEARING
BEFORE THE
SPECIAL COMMITTEE ON AGING
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
WASHINGTON, DC
__________
JANUARY 13, 2022
__________
Serial No. 117-11
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
46-688 PDF WASHINGTON : 2022
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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
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Stacy Sanders, Majority Staff Director
Neri Martinez, Minority Staff Director
C O N T E N T S
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Page
Opening Statement of Senator Robert P. Casey, Jr., Chairman...... 1
Opening Statement of Senator Tim Scott, Ranking Member........... 3
PANEL OF WITNESSES
Gerry Walsh, Senior Vice President of Investor Education,
Financial Industry Regulatory Authority, Washington, D.C....... 5
Cindy Hounsell, President and Founder, Women's Institute for a
Secure Retirement, Washington, D.C............................. 6
Dorothea Bernique, Founder and Executive Director, Increasing
H.O.P.E., North Charleston, South Carolina..................... 8
Patti Szarowicz, Aging and Disability Resource Counselor, Atlanta
Regional Commission, Area Agency on Aging, Atlanta, Georgia.... 10
CLOSING STATEMENT
Closing Statement of Senator Robert P. Casey, Jr., Chairman...... 22
APPENDIX
Prepared Witness Statements
Gerry Walsh, Senior Vice President of Investor Education,
Financial Industry Regulatory Authority, Washington, D.C....... 29
Cindy Hounsell, President and Founder, Women's Institute for a
Secure Retirement, Washington, D.C............................. 49
Dorothea Bernique, Founder and Executive Director, Increasing
H.O.P.E., North Charleston, South Carolina..................... 58
Patti Szarowicz, Aging and Disability Resource Counselor, Atlanta
Regional Commission, Area Agency on Aging, Atlanta, Georgia.... 60
Questions for the Record
Gerry Walsh, Senior Vice President of Investor Education,
Financial Industry Regulatory Authority, Washington, D.C....... 65
Cindy Hounsell, President and Founder, Women's Institute for a
Secure Retirement, Washington, D.C............................. 72
Dorothea Bernique, Founder and Executive Director, Increasing
H.O.P.E., North Charleston, South Carolina..................... 75
Patti Szarowicz, Aging and Disability Resource Counselor, Atlanta
Regional Commission, Area Agency on Aging, Atlanta, Georgia.... 76
Additional Statements for the Record
Credit Union National Association................................ 83
Alzheimer's Impact Movement...................................... 84
FINANCIAL LITERACY:
ADDRESSING THE UNIQUE JUST-IN-TIME
DECISIONS OLDER AMERICANS AND
PEOPLE WITH DISABILITIES FACE
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THURSDAY, JANUARY 13, 2022
U.S. Senate,
Special Committee on Aging,
Washington, DC.
The Committee met, pursuant to notice, at 9:30 a.m., via
Webex, Hon. Robert P. Casey, Chairman of the Committee,
presiding.
Present: Senators Casey, Gillibrand, Blumenthal, Warren,
Rosen, Kelly, Warnock, Tim Scott, Braun, and Rick Scott.
OPENING STATEMENT OF SENATOR
ROBERT P. CASEY, JR., CHAIRMAN
The Chairman. The Senate Special Committee on Aging will
come to order.
Before we turn to today's topic, I want to commend the
Committee members and the work of this Committee during the
first session of the 117th Congress. This is the tenth hearing
that I have held as Chair, along with Ranking Member Scott, and
our first hearing of 2022. Ranking Member Scott, I want to
thank you for your continued partnership and the work we have
done together.
Today's hearing will examine the decisions that millions of
older Americans make every year, involving their income, their
savings, insurance, homes, and so many issues. These choices
that they make can have lasting consequences for their lives.
Today the Committee is also releasing a bipartisan report
on the help Americans need to make these critical decisions. I
am holding up the report if you cannot see it. It is entitled
``Financial Literacy in Retirement.'' The subheading is
``Providing Just-in-Time Information and Assistance to Older
Americans and People with Disabilities.'' That will be
available on a lot of platforms and through Senate offices and
back in our states. Whoever wants copies of that, we can
provide those. It is critically important that we compile
reports like this and I want to thank the staff for the good
work that they have done to make that possible.
We are also going to disseminate a brochure. The brochure
is entitled ``Retirement Decisions,'' all kinds of information
about the difficult decisions that people have to make before
and even during their retirement.
We know that, for example, this year nearly 11,000
Americans will turn age 65 every single day--11,000 a day. In
my home State of Pennsylvania that number is about 460
Pennsylvanians who will turn 65 each day.
As just one example, many of the Americans reaching this
milestone can benefit from real-time information on how to sign
up for Medicare, for example. One such person is in my home
State of Pennsylvania, from Beaver County, Rochester,
Pennsylvania, is Charlotte Zgoda. Charlotte contacted our
office way back in 2019. Charlotte's husband always took care
of their finances, but when he passed away she was not able to
keep his health plan. When she tried to sign up for Medicare
she learned she would have to pay a Part B late enrollment fee,
and that fee was for life. Had she and her husband received the
support they needed when they approached age 65, Charlotte
believes they would have been able to make a more informed
decision.
Many families face these kinds of challenges. When nearing
retirement, Americans face so many important and complex
financial decisions. These decisions can be daunting for
anyone, no matter who you are.
People, of course, want timely information and help from a
trusted source of information. They seek assistance in making
the right financial decision for themselves and for their
families, but they often do not know where to turn. Last year,
my constituent services team received over 1,000 calls and
emails from Pennsylvanians on these issues. Thankfully, both
Congress and the White House have committed to helping
Americans demystify these financial decisions.
In December, President Biden released an Executive order
intended to enhance the consumer experience and align services
to support people at critical moments, like turning 65. In the
last Congress, some provisions of a bill that I worked on with
Senator Young, the so-called BENES Act--here is a long name for
it, the Medicare Beneficiary Enrollment Notification and
Eligibility Simplification Act. We need acronyms when we have
that, B-E-N-E-S, BENES--portions of that legislation was signed
into law. These provisions make sure that fewer people
experience a gap in health coverage after enrolling in
Medicare. It is also why I am committed to working with Senator
Young and others to reintroduce additional provisions from this
bill.
These policies ensure Americans receive timely notice about
when and how to sign up for Medicare and fair warning about the
penalties that can result from delay. Across kitchen tables all
across the country, retirees and seniors are asking some basic
questions. ``Should I take my Social Security, or should I
wait?'' Second, they might be asking, ``Do I need to sign up
for Medicare, or can I wait?'' Third, they might be asking,
``Is it time to sell my home?'' These are not simple decisions
for anyone. Our witness panel will shed lots of light on the
information Americans need, ``just in time'' to succeed.
With that, I want to turn to Ranking Member Scott for his
opening remarks.
[pause] Sorry about that. I guess that Senator Scott might
be having technical issues.
I wanted to, in the interim, acknowledge members of the
Aging Committee who are with us today, and obviously, some
people will be available now and some people may have to leave
to go to another hearing or another engagement and then will
come back. Senator Rick Scott and Senator Jacky Rosen.
In the interim, while we fix some of our technical issues,
I wanted to start to go through our witness introductions. I
will start, and then we can take a pause for Senator Scott,
whenever that is appropriate.
Let me start with our first witness. Our first witness is
Gerri Walsh from the Financial Industry Regulatory Authority.
Ms. Walsh serves as the Senior Vice President of Investor
Education. She is responsible for developing a wide range of
research and educational initiatives to address systemic wealth
disparities for underserved communities. We want to thank Ms.
Walsh for being with us.
Our second witness is Cindy Hounsell. Cindy is the
President and Founder of the Women's Institute for a Secure
Retirement, goes by the acronym WISER. Cindy has dedicated her
professional life to setting women up for success in
retirement. The organization, WISER, works to provide financial
literacy and support to women across the Nation.
I will turn to a third witness and then we will get to our
fourth witness. Patty Szarowicz hails from Atlanta, Georgia.
Ms. Szarowicz has 15 years of experience with the Aging and
Information Services Unit at the Atlanta Regional Commission.
She helps senior receive benefits and locate services. Ms.
Szarowicz, I wanted her to know that Senator Warnock, who is a
member of our Committee, will be joining us later for
questions, and he and all of us want to hear about your great
work in your home State of Georgia.
At this point I will take a brief pause to see if we have
fixed some of the technical issues.
Senator Tim Scott. Mr. Chairman, can you hear me?
The Chairman. Yes.
Senator Tim Scott. Okay. Sorry you cannot see me. Maybe
that is better for everybody that you cannot see me today. I am
happy to be with you all, even by phone. I apologize for the
technical difficulties that we are experiencing trying to
connect.
I can hear everyone fine by the way, and I can see you
fine. I just cannot get my system to work.
OPENING STATEMENT OF SENATOR
TIM SCOTT, RANKING MEMBER
Senator Tim Scott. Let me thank Chairman Casey for holding
this really important hearing on financial literacy. Financial
literacy is critical to learn as early in life as possible.
Like the Chairman mentioned, as a testament to the
importance of financial literacy for older Americans, the
Committee is working on our annual bipartisan report, and this
year it is on financial literacy. As a kid who was raised in a
single-parent household mired in poverty, but blessed with a
loving mother, I understand and appreciate the importance of
learning financial principles as early in life as possible. It
is one of the reasons why I co-chair the Financial Literacy
Caucus along with Senator Jack Reed. Since 2015, we have
declared April as Financial Literacy Month through a resolution
in a bipartisan fashion.
South Carolina is one of the 21 states that requires high
school students to take a course on financial literacy. There
is a non-profit in our State called SC Economics, whose mission
is to provide training and resources to educators. They have
trained nearly 2,500 teachers and reached more than 235,000
students in South Carolina with their financial literacy
curriculum. It is never too late to learn the importance of
financial literacy.
Part of my focus is making sure that every American, and
particularly our senior Americans, have an opportunity to
understand and appreciate and to benefit from financial
literacy. One of the reasons why this is so important for our
seniors we can see demonstrated through an experience at
Citizens Bank in a small rural town in South Carolina called
Johnsonville, in Florence County. It has trained its employees
to look for suspicious activity and provide seniors the support
they need.
The example that I am talking about was when a 60-year-old
disabled senior came into the bank and asked for an $8,000
cashier's check. The trained employee understood that this was
unusual for this senior and proceeded to ask a few important
questions. Ultimately, the bank employee discovered that the
senior was involved in a romance scam, and was able to stop the
senior from sending $8,000 to someone and never seeing the
money again. Educating our seniors on when it is safe and when
it is not safe to transfer money is a critical component of
financial literacy.
I am also pleased to have dedicated and committed South
Carolinians like Dorothea Bernique of Increasing H.O.P.E., who
has helped countless seniors through financial literacy
programs and helped them to maintain and to achieve their
version of the American dream.
To have financial literacy we must have financial
inclusion. That is why it is so important to continue to work
in many ways to advance the cause of equal access to
opportunity throughout our country.
Building on financial inclusion, I have also introduced,
along with Senator Joe Manchin, the Credit Access and Inclusion
Act of 2021, to expand access to credit for an estimated 45
million Americans with no credit history. When you pay your
bills on time, it should help improve your credit. It is kind
of that simple.
Thank you, Mr. Chairman, and I yield back.
The Chairman. Ranking Member Scott, thank you very much for
your opening statement.
The one thing that did not do in the interim is introduce
Ms. Bernique. Ranking Member Scott, can you?
Senator Tim Scott. Happy to do so. Thank you. Yes, sir, Mr.
Chairman. I am pleased to introduce an individual who is
working tirelessly to improve financial literacy across the
Palmetto State, and that person, as I just mentioned, Dorothea
Bernique. Dorothea is the Founder and Executive Director of
Increasing H.O.P.E., which stands for Helping Others Prosper
Economically. She is located in Charleston, South Carolina.
For the past 16 years, Increasing H.O.P.E. has helped South
Carolinians realize their American dream, by improving their
financial literacy. Ms. Bernique's testimony today is based on
her extensive work and experience on the ground working with
individuals, families, and specifically, older Americans to
become more educated in personal finance.
I want to thank Dorothea for being here today and for doing
such good work on behalf of our State and every single person
who lives there, and we look forward to your testimony.
The Chairman. Ranking Member Scott, thank you very much for
that introduction. Now we will turn to our witnesses'
statements. We will start with Ms. Gerri Walsh.
Ms. Walsh, you may begin your statement.
STATEMENT OF GERRI WALSH, SENIOR VICE
PRESIDENT OF INVESTOR EDUCATION, FINANCIAL
INDUSTRY REGULATORY AUTHORITY, WASHINGTON, D.C.
Ms. Walsh. Chairman Casey, Ranking Member Scott, and
members of the Committee, on behalf of FINRA and the FINRA
Investor Education Foundation, thank you for the opportunity to
appear today.
FINRA is not-for-profit, self-regulatory organization that
works with the Securities and Exchange Commission to regulate
broker-dealers, over 600,000 individuals and 3,400 firms.
FINRA's mission is to protect investors and promote market
integrity. As part of that mission, we focus, alongside the
FINRA Foundation, on research and education to help Americans
achieve financial security.
FINRA makes investor protection for senior investors and
vulnerable adults a top priority. We have rules focused on
these populations and we work with stakeholders to enhance the
investor protection safety net. For example, last year FINRA,
Securities and Exchange Commission staff, and State regulators
developed specialized industry training on the Senior Safe Act,
legislation this Committee knows well. While not all harm
results from sales practice abuse, FINRA take swift action
against broker-dealer misconduct.
At the same time, we believe investor knowledge is key to
prevent harm, especially for older adults. Americans entering
retirement face consequential decisions about health care and
how to turn years of hard-earned savings into income lasting
for the rest of their lives. Pivoting from asset accumulation
to spending down assets, retirees often must make once-in-a-
lifetime choices they typically cannot undo. One wrong decision
can upend decades of careful financial planning.
That is why FINRA provides free, unbiased resources to help
Americans better understand the risks and rewards of investing,
how markets work, and how avoid scams and other financial
pitfalls. It is also why the FINRA Foundation spends
significant resources on research that we share widely. The
Foundation's National Financial Capability Study has revealed
that financial knowledge among U.S. adults is low and has
decreased over time. In 2009, 42 percent had high financial
literacy, by 2018, only 34 percent, and an early look at the
2021 data collection suggests levels have fallen slightly
further. We see the largest decline among Americans ages 18 to
34. Separately, we see demographic differences for women and
most people of color.
For adults with disabilities, the stakes are even greater.
This is, in part, because the cost of living for Americans with
disabilities is 29 percent higher than for those without
disabilities, according to a study funded by the Foundation.
Other Foundation-funded studies have shown that knowledge about
financial and health matters generally declines with age, with
a faster rate of decline tied to such things as poorer
decision-making, a higher susceptibility to scams, and lower
psychological well-being. Overestimating one's cognitive skills
has also been tied to poor decision-making, as has loneliness
when paired with low cognition.
Beyond research, the Foundation assists Americans on
numerous investing and personal finance topics, from investing
basics to managing retirement income and even dealing with the
aftermath of natural disasters. We have worked with dozens of
partners, empowering them to reach people where they live,
learn, and earn, through key channels such as public libraries
and workplaces, and we team up with fellow regulators and
national nonprofits to train intermediaries to combat financial
fraud. You can learn more at finra.org/investors.
In conclusion, we share your belief that bolstering and
maintaining financial literacy in older and vulnerable
populations could yield numerous benefits, including better
decision-making, reducing scams susceptibility, and greater
psychological well-being. Where it can, I encourage Congress to
support research that further explores the nexus between
financial capability and aging and examining what works in
financial education. I also believe enhanced support for State
adult protective service programs, especially those that handle
financial exploitation cases, will help better protect older
and vulnerable Americans.
FINRA and the FINRA Foundation are fully committed to
helping Americans build a secure financial future. Thank you
again for inviting me to testify. I am pleased to answer any
questions you may have.
The Chairman. Ms. Walsh, thanks very much for your
testimony, and you had a couple of seconds to spare, so thank
you.
Our next witness is Cindy Hounsell. You may begin.
[Pause.] Cindy, I think you are muted.
STATEMENT OF CINDY HOUNSELL, PRESIDENT AND
FOUNDER, WOMEN'S INSTITUTE FOR A SECURE
RETIREMENT, WASHINGTON, D.C.
Ms. Hounsell. Okay. Here we go.
Good morning. Thanks to the Committee for inviting us to
participate. I am Cindy Hounsell, President of the nonprofit
WISER, a 25-year-old nonprofit that works to help women,
educators, and policymakers address the complicated issues that
affect women's retirement planning.
Our 5-minute statement, which I hope will not be 6 minutes,
will focus on the issues WISER was asked to address, namely
retirement challenges that women face, the need for targeted
financial information, the need for more retirement income, and
how WISER addresses these challenges to reach underserved and
under-resourced communities by providing financial literacy
programs.
WISER partners with diverse nonprofit groups, companies,
plan sponsors, credit unions, financial institutions, and
financial planners to ensure there is community buy-in and
follow-up. We regularly collaborate with government agencies--
the Social Security Administration, Consumer Financial
Protection Bureau, and the Securities and Exchange Commission.
The audience: midlife and older women, underserved, low-
income women, Black women, Latinas, Native Americans, as well
as women in rural areas, women with disabilities, caregivers,
and limited English speakers, who are all prominent in our
work. We find these women are eager to learn financial basics
and take action with how-to information.
Why women? That is one of the first questions we get. Well,
because women live longer and they need more retirement income,
and they generally have less, plus at age 65, there nearly six
million more women than men, and by age 85, women make up
nearly 70 percent of that population. Many of the 85-plus group
end up near or in poverty, even if they have never been poor
before. This is especially common for women living alone and
for minority women.
Why financial literacy? Research confirms women generally
have lower levels of financial literacy than men and that
literacy is directly linked to overall financial well-being.
The bigger problem is the not knowing--not knowing what they
need to know to make the best decisions or to take advantage of
benefits they might otherwise miss out on.
WISER's key initiative is the National Resource Center on
women and Retirement, and that resource center is administrated
and funded by HHS through the Administration on Aging and its
Older Americans Act programs.
Retirement is a complicated time of life and it is made up
of complicated systems. Most working women living paycheck to
paycheck cannot afford even the smallest financial mistake, and
often life events such as divorce and widowhood have
significant impact on their financial lives. The Center
provides critical retirement planning information that helps
women navigate these real-life changing situations. For
example, one of our award-winning guides, ``Going It Alone: A
Guide for Widows,'' takes the reader step by step through the
process of claiming benefits.
Targeted outreach. We are often asked how do we reach the
women, as the Center has directly reached hundreds of thousands
of women through WISER's and our partners' workshops and
reached millions through publications. The answer is our
partners help us succeed.
Two nonprofits that WISER has worked with for a long time
are MANA, a national Latina organization, a group with 25
chapters, and the National Caucus & Center on Black Aging,
which serves the Black/African American community through
several State and local programs.
The importance of trusted messengers means that the success
in reaching these organizations results from the adaptability
and flexibility needed to make programs work. We provide the
partners with specialized education programs, segmented for the
appropriate audience, and nearly ever experience is successful,
as proven by pre-and post-testing. Unfortunately, these
programs cannot eliminate the racial asset gaps, but they
provide real hope, resources, and ways to improve individual
finances in a complicated economy.
In conclusion, I would just like to focus on some of the
improvements that we see are needed desperately in the
retirement system, including the following: improving and
educating workers about the Saver's Tax Credit, credit for
family caregivers; educating workers about auto portability,
which lowers the annual cash-out rates for job changes;
strengthening Social Security and Medicare so that average
workers know how the systems work; expanding Social Security
benefits for widows and divorced women by removing outdated
claiming restrictions; and updating the supplemental security
income rules by removing restrictions causing extremely low-
income women to live well below the poverty level.
Thank you very much.
The Chairman. Ms. Hounsell, thanks very much for your
testimony.
Our third witness is Dorothea Bernique. Ms. Bernique, you
may begin.
STATEMENT OF DOROTHEA BERNIQUE, FOUNDER AND
EXECUTIVE DIRECTOR, INCREASING H.O.P.E.,
NORTH CHARLESTON, SOUTH CAROLINA
Ms. Bernique. Good morning, Senator Casey and Ranking
Member Scott. Thank you so much for having me this morning. My
name is Dorothea Bernique and I am the Founder and Executive
Director of Increasing H.O.P.E. Financial Training Center. It
does stand for Helping Others Prosper Economically.
When I started my career several years ago as a financial
representative, I thought this was the way that I was supposed
to help teach individuals in the community learn how to manage
their money. Little did I know the need was so much greater
than I had ever imagined, and I was clearly made aware of it on
the day that I decided to leave my job.
On this day, a client had come in to talk about making an
investment. She had called to set up an appointment and was
driven by her daughter to our appointment. Part way through our
conversation, she leaned in a little closer to me and
whispered, ``Ms. Dorothea, what is investing?'' That was the
day I gave myself a pink slip and decided to walk away from a
career to start Increasing H.O.P.E. I knew that the need was
great and that educating clients about financial literacy and
financial products was not enough.
Financial well-being is defined as an individual has the
ability to control their day-to-day and month-to-month
finances, they have the capacity to absorb a financial shock,
and they can stay on track with their financial goals, and
finally, they have the ability to make financial choices so
that they can enjoy life.
The lack of basic financial literacy of individuals, no
matter what the income level, is low as a result of low
financial literacy. Twenty-nine percent of South Carolina
consumers have credit cards which have outstanding debt of 75
percent or more. Twenty-nine percent of the consumers have
credit cards with 75 percent credit limits mastered out.
Fifteen percent of South Carolina households have a zero
percent net worth. Finally, 14.4 percent have households
reporting falling behind on their bills within the last 12
months.
We know that this number is now even astronomically higher
due to COVID and the fact that 14.9 percent of households have
a poverty rate threshold and have a lack of basic financial
knowledge. This results in a very low well-being score of 18
percent for South Carolina. It means that they are not in
control of their everyday finances, they do not have the
ability to absorb financial shock that COVID has presented, are
they are not on track to meet their financial goals.
The end result is not having the ability to make choices
that allow them to enjoy life. Hence, this is how many of our
seniors end up as greeters at Walmart when they should be
enjoying the golden years of their lives. The lack of
knowledge, the lack of money, the lack of money management
skills make it a need for financial literacy and money
management in our State and throughout our country.
For more than 16 years now, Increasing H.O.P.E. has taught
more than 333 classes, provided financial education to more
than 9,500 individuals, and we have prepared free tax returns
for more than 3,650 individuals and families, and finally,
saved more than 300 homes from foreclosure during the housing
crisis. As a certified HUD counseling agency, we have helped
individuals and families improve their scores and become
homeowners.
Our current curriculum that is used in the community,
dfree, is an amazing financial literacy transformation course
for the young and senior clients. The ``D'' in dfree is not
just for debt, but we teach our clients how to get set free
from debt, delinquencies, and deficits so that they can become
free to begin to make deposits, meaning become savers, make
dividends, so that they can become investors, and have finally
have deeds, so that they can become homeowners.
By teaching individuals how to manage their money so that
they can manage their lives, we get to change lives, like Ms.
Brown, who at more than 60 years old, when she sat in front of
us, confessing and crying, because she had made a budget for
the very first time in her life, and this was changing her
life. A component of the training is specifically designed for
seniors to make financial choices that specifically impact
them.
To make an even greater impact, we have moved into an
Opportunity Center that allows us to serve the community in an
even greater way, in partnership with three local nonprofits.
Increasing H.O.P.E., we are able to focus on community economic
development services with the support of a $2.7 million grant
from the EDA and an additional grant which will help us with
the programmatic work of Increasing H.O.P.E. as we continue to
serve the community.
The lack of financial literacy, coupled with financial
well-being and the impact of COVID on families may seem a
little overwhelming. However, there is still HOPE. Increasing
H.O.P.E. Financial Training Center will continue to make a
difference in our community, one class at a time, one
counseling session at time, one person at a time.
Thank you for this opportunity to testify before the
committee. I will be happy to answer any questions you might
have.
The Chairman. Ms. Bernique, thank you very much for your
testimony.
Our fourth and final witness for her statement is Patti
Szarowicz. Ms. Szarowicz, you may begin.
STATEMENT OF PATTI SZAROWICZ, AGING AND DISABILITY
RESOURCE COUNSELOR, ATLANTA REGIONAL COMMISSION,
AREA AGENCY ON AGING, ATLANTA, GEORGIA
Ms. Szarowicz. Chairman Casey, Ranking Member Scott, and
members of the Committee, thank you for the opportunity to
share my 15 years of experience serving as a certified Aging
and Disability Resource Connection Counselor at the Atlanta
Regional Commission. The Atlanta Regional Commission is a
regional planning and intergovernmental agency that has
multiple functions, including serving as the Atlanta region's
Area Agency on Aging. In that role, we serve older residents,
caregivers, individuals with disabilities, and grandparents
raising grandchildren, by providing them access to information
or resources that they need.
Our ADRC is part of the No Wrong Door System, a
collaborative effort of the Federal Administration for
Community Living, Centers for Medicare and Medicaid Services,
and the Veterans Health Administration. In the Atlanta region,
we refer to this and other services to consumers as
``Empowerline.'' Every month, our Empowerline counselors assist
more than 7,000 callers. Since June 2021, we have seen an
increase in our calls by about 25 percent. Last State Fiscal
Year we assisted 57,291 residents. In addition, people can
access information and search for services on our website,
empowerline.org, which has experienced a steady increase in
visits.
Our 27 full-time equivalent Empowerline counselors respond
to requests that come in via phone, email, fax, chat, and walk-
ins. We provide information on housing, transportation, in-home
services, financial assistance, and more. The ARC is the entry
point for the Georgia Medicare Home and Community-Based
Program, known as the elderly and disabled waiver program, as
well as the entry point for services funded through the Older
Americans Act.
The amount of time that counselors spend on the phone with
each person averages 25 minutes, but many cases take much
longer, sometimes multiple days, depending on the nature of the
call. Simply, listening to a person's story can be supportive.
Every call we receive is treated with a person-centered,
holistic approach to help the person with all of their needs.
During the 15 years I have worked at the ARC, the calls
have become increasingly more complex, because of the callers'
difficulty navigating health care and financial benefits such
as Medicare, Medicaid, and Social Security. Many people do not
have a support system. The person may be widowed, living alone,
estranged from family, or family lives out of town and can only
provide limited support. Lacking computer skills or access to
the internet creates further barriers. Oftentimes I can hear
the pain and despair in their voices.
These barriers and lack of support system, we frequently
are the only person's lifeline for obtaining information that
can educate and support that person in making critical, life-
changing decisions. People are looking for someone to help
translate the information they receive in the mail, hear on the
radio, see on the television, or information on websites, such
as Medicare and Social Security. As an unbiased, person-
centered and free resource, Empowerline counselors can be
trusted to provide help without the ulterior motive or for our
agency's financial gain.
Financial and health literacy should include knowing where
to turn for trusted help when the system is too complicated to
navigate on your own. We aim to get at the root cause of the
challenges people are facing and help them understand what is
available to them and how to access it. Without help from
Empowerline counselors, people can find themselves, for lack of
knowledge, in one of the following scenarios: enrolled in a
Medicare plan paying $20 to $40 copays when they are eligible
for Medicare, Medicare, and have no copays; paying Medicare
Part B premiums, not aware of eligibility for extra help or
because they forgot to renew their Medicare.
Congress can help us better support older residents, adults
with disabilities, and their care partners by supporting
additional financial support for ADRC, so we can hire
additional counselors. ARC receives funding from Georgia's
Medicaid agency for the Medicaid HCBS waiver access, and
Georgia's State Unit on Aging. However, our State Unit on Aging
only designates $37,000 per year for ADRC information
counseling, not enough funding for even one full-time staff
person; public awareness of the national network of Area
Agencies on Aging and the invaluable, unbiased guidance we can
support for people; and more user-friendly technology for
documenting client data, better integration across our
technology systems, which include the telephone, resource data
base, and client management systems.
Thank you for this opportunity to testify before the
Committee and allowing me to share my experience and passion
for what I do in serving older Americans, adults with
disabilities, and their care partners. I look forward to
answering your questions. Thank you.
The Chairman. Ms. Szarowicz, thanks so much for your
testimony. I will start a round of questions and actually start
with you for the first question. In your testimony you talked
about the extensive work that the Atlanta Regional Commission
does to assist individuals looking to enroll in Medicare. We
know that many older adults new to Medicare face a complicated
enrollment process.
I mentioned earlier, last year Senator Young and I
introduced the BENES Act. The bill includes provisions that
directs the Federal Government to provide advanced notice to
individuals approaching Medicare age about the basic enrollment
rules.
Given your work assisting people with Medicare enrollment,
how would this legislation help older adults and people with
disabilities with regard to the enrollment process?
Ms. Szarowicz. Chairman Casey, thank you for that question.
I am not an expert on legislation and have not read the bill
you have proposed. However, I do know that if individuals would
receive clear guidance from the Federal Government about
Medicare right before they enroll it would meet a need for
information at a critical decision-making time.
I say this because of the experience with speaking with
highly educated individuals who report being very confused by
the complexity of the Medicare enrollment process and call the
ADRC for information and guidance.
The Chairman. Well thanks very much for that, and I really
appreciate your testimony.
I will turn next to Ms. Walsh, and I will not use the
acronym, just so everyone knows, the full identification of
what we are talking about when we use an acronym. The Financial
Industry Regulatory Authority Foundation, the so-called FINRA
Foundation, supports a number of educational initiatives
provided through libraries.
As of 2019, the most recent number we have for Pennsylvania
is 470 libraries across Pennsylvania serving, in most cases,
the most rural parts of our State and underserved communities.
We also know that many of the people who patronage those
libraries are older adults and people with disabilities.
Through the most recent infrastructure bill, signed into
law this past year, there are critical investments in
broadband, so-called high-speed internet, helping, ``community
anchor institutions,'' like public libraries, better serve
their communities.
Ms. Walsh, can you share more about how libraries can serve
as vehicles of both financial education as well as financial
literacy for older adults and people with disabilities?
Ms. Walsh. I would be delighted to. The FINRA Foundation
has been collaborating with the American Library Association
for more than 15 years in helping to build the capacity of
public libraries and the librarians who work there to be a
resource for personal finance topics and investing topics, and
as a result of that there have been thousands of programs
nationwide that have been focused on particularly people who
have had limited access to the financial mainstream. It is very
consumer focused and unbiased. No sales pitches are allowed.
Libraries know their communities. They serve their
communities. As with other institutions they have pivoted to
digital delivery, and they are increasingly a good resource in
the community. The Foundation has been working with ALA to
train librarians through a series of online modules. The topics
that the training covers include many of the issues that were
identified in the Committee's report--claiming Social Security,
Medicare issues, all the financial planning types of issues
that you identified in the report.
Another way that libraries can be service to the community
is through helping disaster recovery, and that is something
that FINRA has been doing recently in Philadelphia, with
hurricanes this summer. We provide disaster recovery grants to
libraries to help libraries be a hub for people recovering from
the financial aftermath of disaster.
The Chairman. Ms. Walsh, thanks very much.
I will turn next to Ranking Member Scott, but before doing
that I just want to give folks notice, because of a scheduling
change in another committee, the Health, Education, Labor, and
Pensions Committee, we are going to try to wrap this hearing up
at 10:50 or 10:55, so that we can get to that next meeting.
I will turn next to Ranking Member Scott.
Senator Tim Scott. Thank you, Mr. Chairman. I will start
with Ms. Bernique.
Financial literacy is a core component of the American
dream. It empowers consumers to responsibly participate in the
mainstream economic ecosystem. According to the National
Financial Capability Study, approximately two out of three
Americans are unable to answer three of the five financial
literacy questions correctly. Older Americans might also assume
that saving is not as important as it would be if they were a
little younger.
Ms. Bernique, what advice do you give to seniors to help
them boost their financial management skills?
Ms. Bernique. Thank you, Senator Scott, for the question.
We run into this quite a bit, especially with our older or
senior clients and individuals. The first thing that we tell
them is this: it is never too late. Many times they will think
having gone through various phases of life that it is too late
to implement principles.
We also teach them and let them know that money management
is a skill set, a soft skill set, with a principle that, once
implemented, it will work for you, no matter how young or how
old, and that they should continue to engage in educating
themselves and implementing the money management principles
that have the ability and the capacity literally to change
their life. Many times it can be something as simple as one
money management tip, such as making sure that you save a
little bit of your finances from every bit of income that you
have, which will prepare you for an emergency.
While it may seem small, something like that can actually
be life-changing to both the young and our older citizens that
we serve.
Senator Tim Scott. Let me continue with you for a second,
Ms. Bernique. One of the things you said earlier in your
introduction or your introductory remarks was ``Manage your
money, manage your life.'' I think that is a such a powerful
statement. Manage your money, you manage your life, and you
just talked about the importance of savings. No matter what
your age, taking a few points or few percent out your every-
week paycheck or every-other-week paychecks and saving that for
the future is really important, and I really appreciate you
distilling that fact.
Another component to financial literacy that seems to be
more important today than it was maybe ever but certainly 20 or
30 years ago, is the issue of credit in the area of financial
literacy. I will say, without any question, that what you look
like on paper might be more important than anything else, your
credit score.
Can you just talk to us for a few minutes, whatever amount
of time you need, about the importance of managing your credit
as a part of financial literacy?
Ms. Bernique. Yes, sir. The importance of managing your
credit in financial literacy really helps us to be able to have
choices in life. Senator Scott, as you said, what it looks
like, and what you look like on paper can be just as important,
if even not more important, than other things.
The credit, and the need for credit--we live in a credit-
driven society, and so what we teach individuals is unless we
are independently wealthy, you need credit. It is very
important for us, as citizens, as individuals, young and old,
to give credit to our credit. It has merit, so to take the time
to pay attention to this particular area of our lives as it
allows us to have options and choices as you go through life,
and many times, it will be that number on paper that will make
the difference between whether or not you, as a senior citizen,
have to deal with a predatory lender or whether or not you can
go into a traditional bank or lender to conduct business.
Credit is very, very, very important. I think individuals
being mindful of this will help them be able to be prepared for
some of the choices and limitations that they run into as a
senior citizen.
Senator Tim Scott. Thank you, Ms. Bernique. With my
remaining time, which is not much, Ms. Walsh, would you talk
about the importance of lifetime options in your portfolio,
from a financial perspective? One of the things I will say is,
having spent about 20-plus years in the financial services
industry, so many of the annuities did not have the lifetime
options, so sometimes you could outlive your money.
Can you talk about the importance of lifetime options, with
the amount of time that we have left?
Ms. Walsh. Thank you, Senator. That is an important issue.
When people transition from accumulating assets to de-
accumulating assets they do have choices with what they can do
with their money. Some people have a pension. Many Americans
rely on Social Security. If you have accumulated savings in a
401(k) or an IRA, you need to think about what to do with that.
For many people, having guaranteed income can be critical
to being able to meet expenses. Deciding how much of your
portfolio to annuitize, especially if you do not have a very
big portfolio, is a huge decision with important
considerations, so it is a key topic. I see that we are out of
time, but thank you.
Senator Tim Scott. Thank you very much, and Chairman, I may
come back to the witness in a second round, if we have time. We
both have to get to the same Health Committee so we may not
have that time. Thank you, sir.
The Chairman. Thank you very much for that, and we will
turn next to Senator Gillibrand.
Senator Gillibrand. Thank you so much, Mr. Chairman.
I found your testimony very, very interesting, and can you
expand a little bit upon some of the things that younger people
need to maintain and bear in mind to prepare for aging? You
have talked a little bit about putting money aside in every
paycheck. What are some other tools that younger people can use
so that they are better prepared?
Ms. Bernique. To me?
Senator Gillibrand. To anyone who wants to answer it.
Ms. Bernique. I will answer. To help individuals or young
people prepare, it is important, as we mentioned here in the
State of South Carolina, that financial literacy start at a
very young age and that we begin to implement money management
principles and principles into the lives of individuals so that
it becomes just a part of their lifestyle, a part of who they
are, that saving money on a routine or regular basis is not
something that is a last resort or something you do after you
see if you have money left over, so it is a matter of
implementing principles at an early age, training our children
to realize the importance of money and finances, and then just
making it a part of their lifestyle.
Senator Gillibrand. That makes sense. Ms. Hounsell, I want
to talk a little bit about the role of caregivers. Given their
longevity and frequent role as caregivers, how can women
prepare for their future financial health and stability, in
particular? A lot of the hearing we focused on just-in-time
decisions for older adults or people with disabilities, but how
would you make recommendations, from your perspective, for
young people that impact the quality of life at a later stage,
and, in particular, for female caregivers?
Ms. Hounsell. Well I think what needs to happen is that it
is complicated when you start working, you know, and you need
to know what to expect, what to look for, what benefits you
get, whether or not there is a retirement plan offered, so that
you are jumping in and starting as soon as you can.
We run a program for college students every year where they
write a paper and then there is a winner, you know, with what
they would do to change the retirement system, and over and
over again they tell us the same thing--they had no idea about
any of these programs, that they have no idea what, you know,
anything entails, and yet they see their grandparents
struggling, many of them, and that is where they get their
learning experience. Basically, they do not want to end up in
that situation when they are older.
Senator Gillibrand. Yes. Research shows that a large
portion of older adults and people with disabilities have low
levels of financial literacy, and we have heard a lot about
that. Some of these just-in-time decisions like deciding
whether to annuitize a 401(k) have a lasting impact on a
person's well-being and security.
With the growing issue of misinformation and disinformation
on the internet and elsewhere, attaining the knowledge and
skills to make financial decisions can be daunting. Ms. Walsh,
in your role as Senior Vice President of Investor Education,
what do you find are the greatest barriers to education for
older adults and people living with disabilities about
financial literacy, and how do you recommend we overcome them?
Ms. Walsh. Thank you for that question because it is a very
important issue. The barriers that older adults face when it
comes, and people with disabilities when it comes to attaining
financial education are often that it is not offered or made
available in a place that they have access to. You know, the
reality is that only about one in five Americans have availed
of financial education opportunities and very few have been
offered them.
Making financial education more available to individuals is
one of the important considerations if we want to expand
financial literacy, and expanding financial literacy is
important because it is connected with better financial
behaviors in life. People are more likely to save, less likely
to be engaging in predatory borrowing behaviors, more likely to
have a will and to be thinking about their retirement and their
eState plan if they have higher levels of financial literacy.
Senator Gillibrand. Thank you, Mr. Chairman, and thank you
to the witnesses.
The Chairman. Thank you, Senator Gillibrand.
As I mentioned earlier, we have a number of Senators who
are juggling multiple hearings and other conflicts in their
schedules. Senator Warnock has joined us, as I know we had some
Senators join us earlier who may have had to leave. We
appreciate Senator Warnock being with us.
We will go next, just as a previous, after Senator Braun
will be Senator Warren. Senator Braun?
Senator Braun. Thank you, Chairman Casey, Ranking Member
Scott.
Interesting topic. I do not know how anything could be more
relevant currently than increasing your financial literacy. You
know, when I look at the Federal Government, it would be nice
to see a place dispensing that valuable information, maybe
practicing a little bit in terms of what it tries to preach at
the individual level. I do not know that we have been at a more
precarious spot, that I have observed, since I got an economics
degree and was a CFO and CEO for a company I ran for 37 years,
and see a place that does not budget anymore. We pretty well do
a resolution. We do nothing on time. We are still trying to
sort out spending that should have been done almost four or 5
months ago.
I think that creates a credibility issue. It does not
diminish the importance of the topic, but I think it really
begs a question, where should this be focused in terms of where
would it actually be coming from a place that might have the
kind of consistency of practicing the principles that I think
we are trying to dispense when it comes to financial literacy.
You cannot borrow money for consumption, and we do that in
the Federal Government, and do it at a higher percentage every
year. You cannot live beyond your means and expect to be able
to finance that. I really think that the whole issue, as
important as it is, probably needs to be articulated in places
where you could attach this discussion as far back as middle
school, especially in high school.
What I hear more than anything, in traveling through all
the counties in Indiana, is give me a potential employee that
has got some life skills. Financial literacy would be one of
them, and maybe that is more aptly the domain of our local
school boards, our local education, and maybe that is the place
to start.
That being said, I have got a question for Ms. Walsh. Do
you think that with all the money we do spend on this subject
already, kind of the poor results that we are generating
generally, the example that we set here in our own Federal
Government, is it worth the time and additional resources to be
trying to push more through the Federal Government, or is this
more properly the domain of local educators and curriculum in
middle school and high school?
Ms. Walsh. I appreciate the question, Senator, because
tackling the issue of financial literacy and building financial
wellness in our country will take multiple players on multiple
levels. What we have seen is that financial education does
work. It does have an impact, especially over time. The higher
the quality and the higher the quantity of financial education
the more likely individuals are to be engaging in more positive
financial behaviors.
It is critical that there are multiple players in the
field. The nonprofits that we have heard from through our
colleagues who have provided testimony, State and Federal
agencies, all have a role to play. When it comes to schools, we
do see that when there are rigorous requirements concerning
financial education in the classroom that over time, later in
life, the people who have been exposed to those financial
education programs are less likely to be engaging in costly
credit card behavior, costly student loan borrowing, and
predatory lending.
Senator Braun. Would you be able to cite one or two
examples of Federal programs that dispense that information,
have that impact that you are referring to?
Ms. Walsh. Senator, while I do not have access to the
efficacy of programs that are distributed by Federal agencies
we do work in partnership with a number of Federal agencies,
from the Securities and Exchange Commission and the Federal
Reserve Board to the Treasury and CFPB, and we do all work
together to measure the success of financial education and how
we can promote financial wellness, which is why one of the
recommendations that I would make is there be support for
efforts to really suss out what works when it comes to
financial education for different populations.
It is not a monolithic. There is no one-size-fits-all
solution to furthering financial wellness. It really needs to
take into account the different needs of different audiences.
Senator Braun. Well I think that broad-based approach does
make sense. I can tell you that in places like Indiana it is
being given increased attention to life skills. Many lawyers
are looking for individuals out of high school and have those
skills minimally, and most schools across Indiana are starting
to get back into making sure that kids come through middle
school and high school with these basic life skill sets,
including financial literacy.
Thanks for having the hearing.
The Chairman. Senator Braun, thanks very much for your
questions.
We will turn next to Senator Warren, but I just want to let
Senator Kelly know he will be after Senator Warren, and Senator
Blumenthal.
Senator Warren?
Senator Warren. Thank you very much, Mr. Chairman. Thank
you for holding this hearing.
Financial literacy is critical for Americans who are trying
to make key decisions like planning for retirement, but low-
incomes families navigating a thin social safety net that gives
them too little help, all the education and counseling in the
world cannot magically make two plus two add up to ten.
I want to start--take a look at Supplemental Social
Security income, a part of Social Security. SSI provides a
critical lifeline for eight million low-income, elderly, and
disabled Americans, including over one million disabled
children and families that care for them. Right now, our rules
are outdated, they are punitive, and they squeeze way too many
struggling families out of this program and tap about four out
of 10 recipients in poverty.
Ms. Hounsell, you are the President of the Women's
Institute for a Secure Retirement. You help women plan for
retirement and financial security. I just want to ask you about
how you would counsel a woman who is receiving SSI. The maximum
monthly SSI benefit--maximum--is $841 in 2022. The average
benefit is below $600.
Ms. Hounsell, is $600 a month adequate to live in financial
security and save for retirement?
Ms. Hounsell. Thanks, Senator, for covering that issue. No,
it is not in any way adequate. Obviously, it is only half of
the poverty level for elders.
Senator Warren. Okay. This is not going to work. This woman
might have to consider working, if she is able, in order to be
able to make ends meet. Now remember, as an SSI recipient she
is elderly or disabled or caring for a disabled child, so she
may not be able to work. Let's say she is considering it. She
is considering working.
Ms. Hounsell, given restrictive SSI rules, would you advise
her to go to work?
Ms. Hounsell. Well, I mean, every situation is different,
obviously, but I think I would make the person aware of the
amount that she would be allowed to earn, which is a very small
amount, and maybe just start looking, you know, for other
benefits and things that are available to her, that she may not
be aware of. Obviously, you cannot earn--I think what it is--is
less than $75 a month, would be for the average person on SSI.
Senator Warren. Okay, so here she is, based on the average
benefit she is at half the poverty level, right? She is below
the poverty line. The most she can earn before she starts
losing her benefits is, you are telling me, $75 a month, right?
Ms. Hounsell. Right.
Senator Warren. Okay. Let's say she is a senior. How about
claiming Social Security? Will that get her out of this
problem?
Ms. Hounsell. No. No, because she is not allowed to earn,
you know, I think it is something like $20 or something would
stop her there, so, you know, it is unlikely that she would be
able to have a job and to do that.
Senator Warren. She is at half of the poverty level, that
we have established in this country, and if she goes over $20
in terms of collecting her Social Security it will just reduce
her benefits, dollar for dollar, so here she is. She is below
the poverty level because of her circumstances. She receives an
SSI check, but she is going to be punished for working,
punished for claiming Social Security, and punished if she
saves any money. I want to add that she will be punished if she
saves too much, because SSI beneficiaries are allowed a maximum
of only $2,000 in savings, and that includes their retirement
accounts.
By the way, she will also be punished for marrying, because
SSI benefits and asset limits kick in for married recipients.
She will even be punished for receiving groceries from a friend
or housing from her family. In other words, every avenue she
would try to take to lift herself out of poverty is an avenue
that she will be penalized for under our current law.
Now, Ms. Hounsell, I know that you and I agree that
financial literacy is important, but in addition, would
reforming the help that SSI recipients get help overcome these
barriers to escaping poverty and planning for retirement? In
other words, if we just changed law and tried to give more
people opportunities to get out of poverty when they are
getting SSI, would that be helpful?
Ms. Hounsell. Yes. I mean, I do not think there have been
reforms from the time that the bill was introduced in the early
1970's by President Nixon, so I think it is time to make those
reforms and change that. Our office would also check with the
person who is contacting us and whether ABLE accounts are, you
know, an option, where the rules are different for the ABLE
account.
Senator Warren. Yes. Well thank you. I appreciate it, Ms.
Hounsell. You know, after decades of ignoring this problem it
is time for Congress to make reforms to SSI. Right now I am
working with Senators Brown and Sanders to pass the SSI
Restoration Act, which would include raising the SSI benefit
rate, and it would also revise a lot of these outdated rules
that effectively serve as barriers to saving, barriers to
financial independence, barriers to getting married.
Including even just $8 billion in the Build Back Better Act
to raise SSI asset limits, or $11 billion to raise the earned
income disregard would be a significant down payment on
economic justice for SSI recipients and one more reason to pass
Build Back Better. SSI's original goal was to ensure that no
elderly or disabled American would be forced to subsist on
below poverty level incomes, and yet that is exactly what this
law has turned into. We can and we must change the law so it
fulfills its original goals.
Thank you very much, Mr. Chairman. Thank you for this
hearing and thank you very much to our witnesses.
The Chairman. Thank you, Senator Warren. Senator Kelly.
Senator Kelly. Thank you, Mr. Chairman. Thanks for holding
this hearing today.
Ms. Hounsell, I wanted to speak to you about housing costs,
specifically in Arizona. You know, I have heard from seniors
throughout the State who are rightfully concerned about the
lack of affordable housing for folks who are on fixed incomes.
Several months ago, my office learned about a senior who
was facing eviction, who was about to get kicked out of their
home. Now thankfully our team was able to connect with this
person and help them access immediate support as well as some
long-term rental assistance that was made available through
COVID relief packages, so we were able to successfully deal
with this problem.
Ms. Hounsell, first I want to take this opportunity to
remind Arizonans that my office is here to help, so if anybody
is watching this and you need help with a Federal agency please
know that my office is here for you, and I encourage you to
reach out.
Ms. Hounsell, it is clear Arizonans, particularly seniors
on fixed incomes in Arizona, are feeling a lot of pressure in
this housing market with increased costs. I know that this is
not unique to my State. When your organization educates folks
considering or planning for retirement, how do you address
preparing for unexpected costs? What is your advice to them?
Ms. Hounsell. Well, I mean, what we have been doing for a
long time, it is not easy, is advising people to have emergency
funds so that, first of all, they protect themselves when
something unexpected comes along.
The one thing that I have seen in the 25 years that I have
been working on this, and housing is not one of my special
areas of expertise--there may be somebody else who can answer
that question better than I can--is that the salvation for most
low-income women has always been that affordable housing, the
senior housing. Since that is not as available and there are so
many more people with needs I do not know what will happen to a
whole population of people that will get lost. I mean, we have
women contacting us that have been living in their cars for the
last couple of years. I mean, that happens over and over again,
that people are making those car payments so that they know
that they have someplace to go.
Senator Kelly. I visited with seniors at a senior center in
northern Arizona maybe about 6 months ago, and I was at a table
with about four gentlemen, and they live in a senior affordable
housing that was about to reach the limit, the time limit,
where it had to remain affordable housing for the owners of the
development to receive the tax credits. They were going to have
to transition out of that facility because they could no longer
afford the rent increase.
One gentleman told me that he had called around to 60--or
every affordable housing location within like 60 miles of where
they were and he could not find an affordable housing unit.
What do you think the Federal Government should be doing
here to solve this housing crisis for seniors receiving
affordable housing? I know you said it is not your expertise.
Ms. Hounsell. Well, I am just not sure--I know there are a
lot of provisions in these bills and people talk about this all
the time. I am just not familiar with the legislation that is
being offered. Maybe somebody else is more familiar. I just
know that it is not available, especially in the cities. I
mean, that is why the homeless population is, you know,
constantly growing everywhere, including in Washington, D.C.,
where, you know, a number of us at this hearing also live. It
just, you know, multiplies.
Senator Kelly. Ms. Bernique, how about you?
Ms. Bernique. Affordable housing is expansive across our
country. Part of the problem comes from just the lack of stock,
as there is not the availability, and the other part comes from
the high cost of living in areas which make affordable housing
or the ability to afford a place to live unaffordable for most
individuals, due to the fact that their cost of living for just
housing alone ends up exceeding 50 to 60 percent of their
income.
Part of the way that we can solve affordable housing as a
HUD housing counseling agency is just the affordability or the
number of stock. Just having homes available whereby
individuals at lower income levels can actually afford, meaning
affordability is afforded to them based on what their income
is.
Senator Kelly. Well thank you to you both, and Mr.
Chairman, again thank you for having this hearing. I had some
further questions. We can submit them for the record. Thanks
again for having this hearing.
The Chairman. Thank you, Senator Kelly. We will turn next
to Senator Blumenthal.
Senator Blumenthal. Yes, thanks to you and Senator Scott
for this hearing. Very important, very timely, and very much on
the minds of many of the seniors in Connecticut.
I was fortunate to introduce, with my colleague from
Connecticut, Senator Larson, just a few months ago, the Social
Security 2100 Act--Senator Van Hollen joined me in it--which
not only will enhance the Social Security Trust Fund's long-
term insolvency but meet many of the issues that have been
raised, including very eloquently by Senator Warren. I think we
need to support some of Social Security's most vulnerable
beneficiaries including widows and widowers, caregivers, and
our oldest seniors.
Ms. Hounsell, in your testimony you speak to the imbalance
between men and women caregivers in their retirement years. You
have shared that women more often leave the labor force or work
part-time to accommodate family needs, whether that be for
children or elderly parents. Another study shows that single
women who care for elderly parents are 2.5 times more likely
than other caregivers to live in poverty in retirement, often
because they leave the workforce to care for others.
At the same time, studies have found that women often
outlive their male counterparts, leaving them not only as
caregivers for their spouses but also as widows in their later
years. It is cited that at age 85 about 86 percent of women are
single.
Our Social Security 2100 Act provides caregiver credits to
ensure that caregivers are not penalized in retirement for
taking time out of the workforce to care for children or other
dependents, and the legislation includes improvements in
benefits for widows and widowers in two-income households. This
bill also ensures that widows and widowers receive 75 percent
of the combined Social Security benefits the couple was
receiving prior to one spouse's death.
I realize that is a lot in a very short time for you to
digest, but I wonder if you could comment on your view on these
provisions and how crucial it is for Congress to address the
disparities of our most caring workforce that includes 48
million family caregivers.
Ms. Hounsell. I think it is immensely important. I mean, we
recently launched a Financial Caregiver Hub, just to alert
caregivers, basically, to what the financial costs are that
they are likely to incur and how important having a plan for
all of this is really matters.
I think what that legislation does is it hits on the most
vulnerable groups--those who are divorced, those who are
widowed--and it is always unexpected and there is always a
great loss of income when people go through those life-changing
situations, and so do the eldercare. It is like who will pay?
One of the things we have tried to do too is to help
families look at these financial caregiver agreements so that
if one person happens to live close to the parents does not
give up everything and yet become unpaid because she is just
going to be poor down the road, like the statistics that you
mentioned.
I think it is really key that those claiming rules that you
have all considered in that legislation really would make a
difference for so many vulnerable women.
Senator Blumenthal. I am about to run out of time but I
just want to make the additional point that Ms. Szarowicz
speaks, in her testimony, to the importance of knowing waiting
periods regarding disability determination and eligible, as
well as information on when and how to claim Social Security
benefits. My Social Security 2100 Act ends the 5-month waiting
period to receive disability benefits, and I think will provide
much-needed assistance to people who are in need.
I want to just finish by thanking Senator Casey for his
leadership on this entire area of caregiving to our seniors and
elderly. He has really been a champion and thanks again for the
hearing and thanks for this opportunity to participate.
The Chairman. Thank you, Senator Blumenthal.
Now that we have come to the end of the hearing I wanted
to, in the interest of time because of the demands of our next
engagement, both Senator Scott and I with the Health Committee,
I will submit my closing statement for the record, but just
note for the record two things. Number one, is we want to thank
our witnesses--Ms. Walsh, Ms. Hounsell, Ms. Bernique, and Ms.
Szarowicz--for their testimony. We could spend hours just on
part of this topic, and we are grateful for the insights and
the experience that you bring to bear on this. The second point
I will make is that the deadline for questions for the record
will be January 20th.
I will next turn to Ranking Member Scott.
Senator Tim Scott. I will suggest that I too thank you all
for being here and look forward to continuing this discussion
in the future. I will submit my closing statement for the
record as well.
The Chairman. Thank you, Ranking Member Scott. Thanks again
to all of our witnesses. We are adjourned.
[Whereupon, at 10:51 a.m., the Committee was adjourned.]
CLOSING STATEMENT OF SENATOR
ROBERT P. CASEY, JR., CHAIRMAN
Today's hearing highlights the importance of getting
Americans support "just in time"- right when people are making
important financial decisions.
Providing this assistance can make a critical difference in
people's lives.
We learned that many older adults seek help from someone
they trust to make decisions about Social Security, retirement
income, their homes and Medicare.
These trusted sources can include their employers, a wide
range of professionals and even their family and friends, and
for the hardest to reach individuals, organizations in the
community and government agencies are often their main source
of trusted advice and support.
Our continued support of these organizations is essential.
We must properly fund the Social Security Administration
and programs like State Health Insurance Assistance Programs
and Aging and Disability Resource Centers.
Finally, we must strengthen critical benefits like Social
Security and Supplemental Security Income (SSI), which are key
to helping seniors and people with disabilities to build
financial security and save for their futures.
Simplifying processes and rules, especially for benefits
like Social Security and SSI, will reduce confusion and provide
people with clear and meaningful choices, allowing them to make
sound decisions and improve their financial situation.
I want to once again thank all the witnesses for
contributing their time and expertise today.
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, January 20.
Thank you all for participating today and this concludes
today's hearing.
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APPENDIX
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Prepared Witness Statements
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Questions and Responses for the Record
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Additional Statements for the Record
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