Thursday, December 23, 2010

Happy Holidays from WOW!

The WOW office will be closed from December 27-31. We look forward to working with you in the new year!

Friday, December 17, 2010

Importance of Preparing for Long-Term Care Costs

This week, the Elder Economic Security Initiative™ team met with our National Advisory Board to update them on the project and discuss goals for the New Year. Long-term care (LTC) and the importance of preparing future generations for the high costs of aging in place was a major component of the conversation, and, it turns out, in conversations throughout the country. Newsday recently featured the article “We can Avoid an Eldercare Crisis” which encourages Baby Boomers in particular to find ways to save for long-term care now before it’s too late. It also explains how to prevent future elders from depending on Medicaid, which provides benefits to low-income elders unable to pay for care. Medicaid eligibility requirements require those elders living on the edge to spend down their assets in order to qualify.

WOW’s Elder Economic Security Standard™ Index (Elder Index) shows just how important it is to plan ahead. Depending on the level of care, LTC costs can double or even triple what it costs for an elder to meet her basic expenses. For example, in Bronx County, NY, an elder woman renter in good health needs $23, 328 a year to cover basic living expenses. This cost changes dramatically if she is in poor health and needs 16 hours a week of LTC assistance (a medium level of care); her annual expenses would nearly double to over $43,500.

Hence the need for a program to help Americans save for these high costs of care and the reasoning behind the Community Living Assistance Services and Supports (CLASS) Act – signed into law under health care reform. This program will allow workers to pay in to a government supported system and after five years of investment receive a daily cash benefit to supplement long-term care costs. This program will not only benefit elders but people of all ages who need assistance due to physical disabilities. Find out more about the program’s benefits at the New Old Age blog.

The reality is that long-term care is necessary for millions of elders in retirement and though many might not want to think about getting older, we must not only think but act. Through advanced planning and good decision making future retirees can save for their long-term care needs.

Alisha Howell
Communications & Program Coordinator
Elder Economic Security Initiative

Friday, December 10, 2010

New Study Shows Half of Seniors May Experience Poverty

Nearly half of all elders between 60 and 90 will experience one year of poverty, according to a study released this week in Families in Society: The Journal of Contemporary Social Services.

“Of course, this risk is not evenly distributed across the population. One of the most drastic economic divides is race,” notes the researcher, Mark R. Rank, Ph.D. The percentages of people who will experience at least one year below the federal poverty level by different demographic groups include:

• Race: 32.7% of white older Americans; 64.6% of black older Americans

• Marital Status: 51.2% of unmarried older Americans; 24.9% of married older Americans

• Education: 48.4% of those with fewer than 12 years of education; 20.5% for those with 12 or more years of education

This new research confirms the importance of the Elder Economic Security Initiative and the Elder Economic Security Standard™ Index (Elder Index). A comparison of the Elder Index to other measures of income (shown in the chart below) makes its relevance clear. Average annual Social Security income provides an older woman renter with only 61% of the income required to achieve economic security, compared to 81% for an older man.

The data shown by the Elder Index and the new report on elder poverty demonstrate the need to increase the benefit adequacy for Social Security recipients and to increase access to income support programs for seniors. Dr. Rank notes “legislators should consider policies that encourage greater levels of savings among the working-age population, facilitating cooperative living arrangements among the elderly, establishing fair terms with respect to reverse mortgage programs, and strengthening the Social Security and Supplemental Security Income programs.”

The time to act is now. Join your state’s Elder Economic Security Initiative to help rid poverty among our nation’s elders. The Initiative is currently active in 17 states; find out if your state is one of them.

Maggie Flowers
Field Manager
Elder Economic Security Initiative