United States Aging Statistics
The number of people age 65 and older in the United States in 2019 was 54 million. This group accounted for 16% of the total population. Both numbers have been rising steadily for years.
Increasing Life spans
Don’t get me wrong – this is a great thing. However, these trends also tell us that the seniors of today and the not-too-distant future will have much longer retirements than previous generations. We all want to live in a society where we will be able to live those years at a comfortable standard of living.
Rising Healthcare Costs
Access to good healthcare is an important factor in living longer and in maintaining a standard of living. Unfortunately, these costs are rising dramatically and show no signs of slowing down. Healthcare costs have risen far faster than inflation.
In 2019 it is estimated that the average couple 65 years and older will need a staggering $387,644.00 to cover their share of health costs during the rest of their life. Medicare Part A and Part B covers expenses such as hospital stays, care at a skilled nursing facility, doctor visits and services, physical therapy, lab tests, and more. About 40% of the estimated cost comes from premiums for Medicare, such as Part B or Part D, and doesn’t include the surcharges for higher-income retirees. Another 40% goes toward deductibles and copays and the remaining 20% is for prescription drugs.
The Rising Costs of Long-Term Care
An estimated 70% of seniors will require long-term care during their lifetimes and most want to stay in their homes, not in a nursing home. That number will rise with life expectancy, as you are more likely to need care as you get older. Much like general healthcare, these costs are rising.
It is important to note that these costs were not factored into the health care expenditures that we mentioned previously. Seniors will in fact need to find even more resources to cover these costs. Most Americans believe that Medicare and Medicaid will cover the costs of long-term care. These programs do cover some of the costs, but according to this research from the Centers for Medicare & Medicaid Services, nearly 30% of nursing home & home care costs are paid for out of pocket.
A new wrinkle in the retirement plan
Runaway inflation is something nobody expected in their retirement plan.
A Retirement Security Crisis?
We’ve established that the American population is growing older, that Americans are living longer, and that health care and long-term care costs are rising rapidly. Taken together, these forces may cause serious financial problems for retirees over the coming decades. Most people never consider how when they loose a spouse, they also loose a source of income.
Millions of homeowners age 62 and over have successfully used a reverse mortgage to maintain a more comfortable and secure lifestyle, and be better prepared for the future.
- Enjoy the extra monthly cash by never having a mortgage payment
- Pay off other loans or debts
- Create an Emergency fund in the event of a crisis
- Cover medical expenses and prescription costs
- Fund home repairs or modifications
- Supplement retirement cash flow
- Use the money to help a family member now, rather than later
- Travel and enjoy your golden years