Lots of older adults are able to manage the cost of aging with some combination of Social Security income and retirement income, and some manage on Social Security income alone,. But, the cost of growing old quickly becomes unaffordable for most when they have health issues. Judith Graham reports for Kaiser Health News on the Elder Index, a web tool that helps you see what it will cost to grow old based on where you live.
The Elder Index reveals the income that older adults require to live independently. Social Security benefits do not cover a big chunk of their basic needs, even if they are in good health, 68% for people who live alone and pay rent and 81% for couples.
The Elder Index also shows that both nationally, and in every state, older Americans need far more to live than the federal poverty level might suggest. Nationally, older adults in good health who rent their homes need annual incomes of more than twice the federal poverty level to cover their basic needs, $27,096 v. $12,996.
The majority of older women (54 percent) are living on annual incomes that are inadequate to cover the cost of basic necessities including health care. Forty-five percent of men are in a similarly fragile predicament.
Researchers at the Gerontology Institute, University of Massachusetts, developed the Elder Index. You enter your location and your health status–poor, good or excellent–and the Elder Index tells you how much money you need to cover basic necessities in old age. Costs are significant, more so for people living alone than for couples, as well as for home homeowners with mortgages than renters and people in poor health.
Last year, pre-inflation at nine percent, the data show that around 11 million older Americans could not afford basic necessities. Almost five million single older women, two million single older men, and more than two million older couples are economically insecure as a result of their low incomes. Now, the numbers are certainly higher.
In New York City, where I live, the Elder Index reports that, each month, a single person in good health who does not own a home, needs $3,056: $1,682 for rent, $454 for health care, $252 for transportation, $275 for food and $393 for miscellaneous. Someone in poor health needs $3,300, an additional $244. Someone in excellent health needs $2,921.
In New York City, single homeowners in excellent health without a mortgage spend the least, $2,224. If they have a mortgage, their monthly costs soar by nearly $2,000 to $4,203.Couples in excellent health and without a mortgage fare best, $3.068 in monthly costs. That amount rises to $3,826 if they are in poor health. It rises further to $5,805 if they have a mortgage.
Congress needs to do better for older Americans, among other things, through relief on property taxes and expanding eligibility for programs that lower people’s health care costs, including Extra Help and Medicare Savings Programs.
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