The good news: We are living longer, and older Americans as a group now have more money, better medical care and more influence than ever before. The bad news: Our increased longevity is creating a strain on the health-care system, doing battle with our finances and forcing some people to work longer than they might have planned.
Listed below are 10 facts that illustrate the issues older Americans–and society as a whole–are facing now and in the years to come as the demographics shift.
1. Since 1900 the percentage of older people in the U.S. has tripled, and the Census Bureau says the growth trend will continue.
In 1900, 1 in 25 U.S. residents were 65 or older. In the 2000 U.S. Census that rate had risen to about 1 in 8 people. Census projections indicate that by 2030 about 1 in 5 residents will be 65 or older. The Centers for Disease Control and Prevention calls this age shift a “longevity revolution.”
As older Americans become a larger proportion of the population, the resulting increase in the number of people with chronic health conditions will create a huge demand for health care and social services, says the CDC. In addition, overall U.S. health-care expenditures are expected to increase 25 percent by 2030.
More workers, especially those who specialize in geriatrics, will be needed to provide health care and social services. Meanwhile, the workforce itself will be aging, so proportionately fewer young workers will be available. New infrastructure and building designs will be important to ensure that communities are accessible to those with disabilities and affordable for those on fixed incomes. As a group, older Americans will continue to make their mark on corporate America and the national political agenda as they flex their growing buying power and political influence.
2. People age 65, on average, now can expect to live into their early to mid-80s.
U.S. residents who reach age 65 can expect to live another 18.5 years (16.8 years for men and 19.8 years for women), according to figures released in February by the National Center for Health Statistics. In 1935 when Social Security was signed into law, average life expectancy at age 65 was 12.5 years. Social Security and retirement savings plans now must cover more years.
The increase in longevity also increases the likelihood of having one or more chronic health conditions that can create financial burdens and decrease the quality of life. People older than 85 are most at risk for chronic conditions. That group in the U.S. is now about 38 times larger than it was in 1900 and it is expected to more than double by 2030.
3. The overall poverty rate for older Americans has dropped, but money is still an issue for many.
In 1959 more than 35 percent of older Americans were below the poverty level, the highest poverty rate of all age groups at that time. In 2002 about 10.4 percent of older Americans ranked below the poverty level, according to the Census Bureau.
While older Americans as a group are doing better economically, poverty problems are still widespread among older people in racial minority groups and those who require extensive medical care, said Richard L. Kaplan, a University of Illinois law professor who specializes in elder law. One of the biggest issues in elder law is how to pay the medical bills, he said.
4. The estimated average annual cost for a private room in a nursing home is now more than $70,000, according to a 2004 survey released by MetLife insurance.
Estimates of nursing home costs vary widely from place to place. A GE Financial Survey released in 2003 found the average annual cost was highest in Alaska ($166,700) and least expensive in Louisiana ($35,900).
Many people don’t require nursing home care, and of those who do, 40 percent are there for less than 100 days, Kaplan said. The problem is, there is no reliable way to predict your future need for such care.
“This is probably the single biggest financial exposure that people have. I sometimes refer to long-term care as the hidden estate tax,” Kaplan said. “This is where people’s money goes.”
5. More than 9 out of 10 older Americans receive Social Security benefits, and for most, it’s their major source of income.
About 92 percent of U.S. residents 65 and older were receiving Social Security benefits as of the end of 2004, the Social Security Administration reports. The average monthly benefit for retired workers and their dependents was $955. It’s the sole source of income for 22 percent of the elderly, according to the administration. For the other 70 percent, Social Security is augmented with income from stocks and mutual funds, pensions, and earnings.
6. About 40 percent of American workers who are younger than 65 have individual retirement accounts or 401(k) plans, according to a recent report.
More and more American workers are participating in such retirement savings options, says the study, released in January by the Employee Benefit Research Institute, a nonprofit public policy group. In addition, about 20 percent of workers have some sort of defined benefit such as a traditional private or government pension plan. At least 40 percent are on track to retire with only Society Security benefits as planned retirement income, said Craig Copeland, senior research associate for the Institute.
The group also reported that the average 401(k) balance was $33,647 and the average IRA account balance was $26,951 for workers 21 to 64 in 2002. While the averages for people who are near retirement age were about 75 percent higher, overall, the numbers are “not particularly encouraging for supporting a great lifestyle in retirement,” Copeland said.
7. More and more older Americans are still working for a paycheck–or looking for a job.
The Bureau of Labor Statistics reports that more than 20 percent of people 65 to 74, and 5 percent of people 75 and older, are still in the labor force. People 55 and older now make up about 14.3 percent of the total labor force, but the bureau projects that by 2012 they will represent more than 19 percent of the total labor force.
8. More than 20 percent of the U.S. population has an unpaid “second job” providing care to another adult, according to one study.
Almost 8 in 10 of those needing that care are age 50 or older, reports “Caregiving in the U.S.,” a study released last year by the National Alliance for Caregiving and AARP. The study cited aging as the major reason there was a need for care.
While the typical caregiver was 46 years old, 43 percent of caregivers were 50 and older. Those doing the most intense caregiving tend to be older, lower-income and living with the recipient of the care, said Gail Hunt, executive director of the National Alliance for Caregiving. They report the heaviest toll on their own health from taking care of someone else.
9. About 80 percent of older Americans have at least one chronic health condition and 50 percent have at least two, according to the CDC.
Arthritis, cardiovascular disease, cancer, diabetes and Alzheimer’s disease are among the leading chronic conditions that significantly impair the quality of many older American’s lives. In spite of the large number of people confronting these conditions, the American Geriatrics Society reports that older Americans are seeing improvements in physical functioning.
Better treatments along with health-care programs that offer immunizations, early detection of disease, injury prevention, and healthy lifestyle practices are keeping people in better shape throughout their lives.
Palliative care, a medical specialty that focuses on managing pain and other symptoms rather than curing them, is making headway in improving the quality of life near the end of life, said Dr. Linda Emanuel, director of the Buehler Center on Aging at Northwestern University. 10. Older Americans are heeding the advice to exercise, and their activity of choice is walking.
The U.S. Census Bureau estimates that 15.8 million Americans aged 65 and older participated in exercise walking at least six times in 2003, making it the most popular form of recreation by far for this age group. Medical studies cite numerous benefits from exercise walking, including reducing the risk of and controlling the affects of chronic disease, improving sleep, preserving strength, and even boosting brain power. Campaigns abound to encourage older Americans to walk regularly. Communities also are creating landscapes to encourage residents to integrate walking into their daily lives.
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