weekly blog--one for the ages
GoBankRates came up with a formula to determine how much income is needed in each state to cover living expenses in retirement, and then added an additional 20 percent to account for the “comfortable” aspects of retirement. The best and worst below.
District of Columbia--$101,000
And then there is what’s known as “The Forgotten Middle” — older adults who don’t have enough money to pay for the housing out-of-pocket but aren’t poor enough to qualify for Medicaid, which covers some long-term care costs for lower-income Americans. By 2029, middle-income people 75+ are expected to comprise 43% of the total population of people that age, according to a survey. 60% of middle-income adults age 75 and older will have mobility limitations, 20% will have three or more chronic conditions and one or more functional limitations and 8% will have cognitive impairment.
The study estimated that assisted living rent and other out-of-pocket medical expenses will cost $60,000 annually, on average, by 2029; independent living and medical out-of-pocket costs will be about $45,000 annually, on average. One economist estimated that if assisted living costs could be lowered by $10,000 annually, an additional 2.3 million middle-income Americans age 75 and older could afford them.
Unfortunately, the bottom line is that most middle-income seniors will lack the financial resources required to pay for private seniors housing, regardless of their preferences. Even if seniors devote 100 percent of their annual income to seniors housing—setting aside any personal expenses—only 19 percent of middle-income seniors will have financial resources that exceed today’s costs of assisted living.
Many seniors treat housing equity differently from other financial resources and attempt to liquidate other income and assets before liquidating the equity. Such housing equity may be the family home that some older adults keep as a nest egg to protect against future, unexpected financial hardship or wish to preserve for their children. However, if we assume that middle-income seniors do draw down housing equity, 54 percent (7.8 million) will still lack the resources to pay for seniors housing at today’s costs.
This confluence of factors creates a significant unmet future need, which demands new housing and care solutions to support the emerging generation of America’s seniors. Creating and financing those solutions will require innovation from public and private stakeholders to bring more affordable seniors housing options to the market and to enable people at all income levels to access the care they need and want as they age.
Plans are underway in my town to build a new Senior Center. The major concerns are where it will be located, how much will it cost, and what services will be provided.
The National Institute of Senior Centers (2005) reports that there are currently 16,000 senior centers serving older adults in the US. In 1986, the National Center for Health Statistics estimated that 15% of all Americans aged 65 and over (roughly 4 million individuals) had attended a senior center in the past year.
While there is no reliable data available currently, over 10 years ago, a study estimated that nearly 10 million senior citizens utilize a senior center program or service annually. And according to AARP, approximately 70 percent of senior center participants are female, and the average age of all participants is 75.
Yet, despite these statistics, many senior center directors report an alarming drop in attendance rates among seniors. Other senior center directors complain about the lack of participation by “Boomers.”
Currently, programs typically offered range from nutrition and wellness programs to social and recreational activities. More than 60 percent of senior centers are focal points for delivery of Older Americans Act services, which means they provide access to multiple services in one place.
Also, senior Centers generally have between three and eight funding sources, including government funding, local business contributions, and in-kind donations. Most are heavily aided by volunteers as well.
While some senior centers that have diversified programming and/or modernized facilities report an increase in participation, most senior centers report otherwise. The issue is further complicated by the decreasing public support for senior centers from federal, state, and municipal sources of funding.
The dilemma towns like mine face is a Catch-22 situation--how do the Senior Centers’ attract greater numbers of older adults without modernizing and how do they modernize without adequate fiscal support? And to add to the confusion, there is a surprising lack of research in this area.
A new survey from NerdWallet found that today’s retirees on average stopped working at age 59. 36 percent said they didn’t have a choice. 18% said they had to stop because of their health, and 9 percent said a job loss forced them to do so.
A study published by researchers at Boston University found that people who scored higher on an optimism assessment were more likely to live past the age of 85. Those with higher optimism levels were more likely to have advanced degrees and be physically active, and less likely to have health conditions such as diabetes or depression.
Most baby boomers share a fear of outliving their savings. With a recession looming, baby boomers who once assumed they could tolerate risk are being put to the test amid an alarming spate of warning signs: battered stock prices, plunging yields in long-term bonds, worsening US-China trade tensions, slowing economies in Europe and Asia, and political instability.
During a recession, financial experts say it’s best not to completely steer clear of the stock market. If you want to help insulate yourself during a recession, consider investing in healthcare, utilities and consumer goods sectors where people are likely to still spend money. Another approach--investing in dividend stocks. The experts recommend finding companies with low debt-to-equity ratios and strong balance sheets, or companies that have increased their dividend payouts for at least 25 consecutive years.
If you think the market is still too volatile, consider purchasing real estate and then renting to reliable tenants, or investing in precious metals like gold and silver.
Another alternative is moving to another city or town to create a more relaxed, stress-free lifestyle. This is especially advantageous if you live somewhere with a high cost of living, you live in an area with high income or property taxes, you live in a state that taxes social security, or you live in a place where you absolutely need a car.