Senior poverty rates have steadily improved in recent decades and now are the lowest of any major demographic group in the country. While the safety net may be working for the nation's poorest seniors, there is a much larger group of older Americans that does not qualify for low-income benefits. The only safety net for these people is their own income, and the picture is not pretty.
Wider Opportunities for Women (WOW), a Washington nonprofit, has just finished work on a national study about what older Americans spend each year on basic necessities, primarily housing, food, transportation, and healthcare. WOW calls the figure its Elder Index—a "getting by" spending total for people who do not receive any government support payments. The index was developed by the Gerontology Institute at the University of Massachusetts Boston.
WOW assembled this information for every county and city in the country. It then looked at the median incomes of older people throughout the country and compared the two sets of numbers. Across all 50 states and the District of Columbia, WOW found, not a single state's median income is equal to the basic cost of living for its older residents. Not one.
In other words, more than half of the seniors in every state in the union do not make enough money to afford a basic lifestyle.
And the percentage is much higher in some states. Perhaps surprisingly, Massachusetts is in the worst shape. Its high costs are not matched by senior incomes. As a result, the median income of a single person at least 65 years old who rented an apartment was barely 62 percent of the basic cost of living for older Massachusetts residents. In dollar terms, the gap was nearly $10,250 a year.
Older residents in many high-cost states were similarly strapped, helping explain why the six New England states were all among the worst-performing states in the nation. The best states included a mixed lot. Western states fared well, but so did the Midwest. Alaska was the leader, but even its median senior income covered only 95.6 percent of its Elder Index annual spending total. Others in the top 10 were Montana, Utah, Michigan, Arizona, Ohio, Colorado, Washington, Indiana, and Idaho.
Using Massachusetts as an example, WOW President Donna Addkison said the data suggested "that older residents in Massachusetts in significant numbers are facing untenable situations." They're having to make critical choices about their spending. In these spending trade-offs, the rent and utilities may get paid, she said, but healthcare needs may go unmet and nutritious foods may be foregone in favor of less costly items.
This is WOW's first national study, so it does not know for sure whether seniors are having more or less trouble affording basic necessities than they used to. "Given the state of the economy, I believe it's fair to say that things are getting worse," Addkison said. "It's becoming incredibly expensive to retire in this country. At the same time the benefit system that provides supports for older Americans is increasingly challenged, and it's also harder and harder for an older person to find a job."
"I would not pretend to say that there will ever be a day when we close this gap completely," she said, "but we need to narrow it. And it becomes incumbent on all of us [in policy and leadership positions] to be having very serious, very real conversations about how we create an environment where older Americans are not forced to make these choices."
|State Rankings of Elderly Economic Security Gap|
|(Median 65+ household incomes and necessary living costs)|
|National Rank||State||Elder Income||Elder Expenses||Income % Expenses|
|Source: Wider Opportunities for Women|