The perils of aging generally escalate around 75, and they are becoming more pervasive as more Americans live to very old ages.
One of these perils – declining cognitive ability – often creates financial problems. A new study that summarized the research on this side of the retirement equation identified the financial fallout from dementia.
Currently, dementia afflicts roughly a quarter of seniors in their early 80s. And geriatricians and demographers have predicted for years that dementia will become a serious societal problem in the future as the tsunami of baby boomers reach older ages.
The first sign of deteriorating financial skills might be forgetting to pay a bill. But when severe dementia sets in, the vast majority completely lose their ability to manage their finances and risk making big mistakes, such as losing money in a fraudulent investment scheme.
Another concern is retirees’ growing reliance on 401(k)s for more of their income. Increasingly, they are grappling with the complicated question of how much money to withdraw each year from their 401(k) accounts – this is difficult for anyone but virtually impossible for people with dementia.
Fortunately, most of them get assistance managing their finances. But the seniors who don’t get help face potentially grave repercussions, such as having difficulty affording food, housing and medical care.
Managing money is not the only financial risk posed by dementia. A more serious issue is the potential need for a lengthy stay in a nursing home, which will be addressed in a future blog post. …Learn More
In April, Trudy Schuett will have a procedure to save a tooth, which she estimates a dentist would charge $3,000 to $5,000 to do.
But Schuett, who lacks dental insurance, will pay about $1,000, because the procedure will be performed by dental students at Midwestern University Clinics in Glendale, Arizona. Her cleanings at the school are affordable too.
Regular clinic visits have saved “buckets of money,” she said.
She is one of those resourceful retirees who always finds a way. But two out of three people over 65 do not have dental insurance, according to the Henry J. Kaiser Foundation, often because they lose the coverage when they leave their employer. Medicare does not pay for routine dental expenses, though it sometimes covers care for medical procedures considered integral to a retiree’s health, such as jaw reconstruction or heart surgery; some Medicare Advantage plans offer dental insurance.
But retirees who lack dental insurance are often forced to forgo care or limit their visits to the dentist. Half of seniors haven’t been to a dentist in over a year, Kaiser said. When they do see a dentist, they spend an average $922 out of pocket. For the half of Medicare beneficiaries trying to live on $26,200 or less, dental care consumes, at minimum, 3.5 percent of their income.
Poor dental care also causes health problems. Dry mouth, a side effect of some medications, can cause teeth to loosen or fall out. Tooth loss makes it more difficult to eat. For a variety of reasons, 15 percent of retirees have lost all of their natural teeth – in West Virginia, a low-income state, 30 percent of retirees have no teeth, Kaiser said.
Schuett, who is 67, is working five hours a week for extra income, but she would rather not spend it on expensive dental care. By saving money at the university clinic, she gets to “blow some cash on the grandkids.”
Squared Away writer Kim Blanton invites you to follow us on Twitter @SquaredAwayBC. To stay current on ourblog, please join our free email list. You’ll receive just one email each week – with links to the two new posts for that week – when you sign up here. This blog is supported by the Center for Retirement Research at Boston College. …Learn More
With more Americans today living into their 80s and beyond, the elderly are becoming more vulnerable to slipping into poverty.
To reduce the poverty risk facing the oldest retirees, some policy experts have proposed increasing Social Security benefits for everyone at age 85. Under one common proposal analyzed by the Center for Retirement Research in a new report, the current benefit at this age would increase by 5 percent.
The poverty rate for people over 85 is 12 percent, compared with 8 percent for new retirees. But more elderly people may actually be living on the edge, because the income levels that define poverty for them are so low: less than $11,757 for a single person and less than $14,817 for couples.
One reason the oldest retirees are especially vulnerable is that their medical expenses are rising as their health is deteriorating, yet they’re too old to defray the expense by working. This is occurring at the same time that the value of their employer pensions – if they have one – has been severely eroded by inflation after many years of retirement.
Further, elderly women are more likely to be poor than men, because wives usually outlive their husbands, which triggers a big drop in income that is generally not fully offset by a drop in their expenses.
Limiting the 5 percent benefit increase to the oldest retirees would ease poverty while containing the cost. …Learn More
The federal government has released online brochures to give people who are thrust into a caregiving role a better idea of what they’re getting into.
“It’s a big shock at first and a big adjustment,” an Episcopal priest says in the video above. He became his mother’s caregiver after she developed dementia.
But people who anticipate they will one day be a caregiver can soften the blow by studying up on their future responsibilities with the Consumer Financial Protection Bureau’s new guides to caring for a loved one.
The brochures are free and cover four financial responsibilities: guardian, trustee, power of attorney, and fiduciary for a Social Security or Veterans Affairs beneficiary.
They can be downloaded in English or in Spanish at the federal Consumer Financial Protection Bureau (CFPB) website, or the agency will mail them.
CFPB has also posted brochures detailing the caregiver regulations and laws specific to six states: Arizona, Florida, Georgia, Illinois, Oregon, and Virginia. The state guides each cover the same four topics: guardian, trustee, power of attorney, and fiduciary for a Social Security or Veteran Affairs beneficiary.
Non-profit organizations in Michigan and Texas have also published their own brochures on caregiver issues in their states – links to these brochures are also on CFPB’s website. …Learn More
Nearly 10 million seniors are having difficulty paying for housing – and the problem is growing.
Housing experts typically recommend that people keep their housing costs below a third of their income. But one in three Americans over age 65 are spending more than that on their rent or mortgage payment, utilities, property insurance, maintenance, and other housing costs, according to a new study, “Housing America’s Older Adults,” by Harvard’s Joint Center for Housing Studies.
If the senior housing problem hasn’t reached crisis proportions yet, Jennifer Molinsky, who wrote the center’s report, predicted that it will if nothing is done to increase the supply of housing structures that are both affordable and age-friendly to meet the needs of aging baby boomers. The number of households over 80 will more than double over the next 20 years, the housing center estimates.
“Unless we create more options for people at the middle- and lower-income levels, we are going to be seeing that people have fewer choices and that they’re forced into options they don’t want,” she said. …Learn More
Kathy Barker already was having concerns that her elderly father’s dementia made it increasingly difficult for him to manage his life. When his doctor said he could no longer drive, Barker had to do something.
A contractor was hired to build a 448-square-foot cottage in the backyard of her Tampa home. Her father enjoyed it for just 10 days before going into the hospital, where he died. But the house was still a great solution – this time for her mother, JoAnn George. (Her parents divorced long ago.)
Last November, George was moved into the backyard “granny pod,” which has a front porch, living room, bedroom, bathroom, and small refrigerator – but no other appliances. Granny pods, which come in a variety of architectural styles, from Victorian to modern, aren’t cheap. George’s cottage cost $90,000 to build, putting it in the higher end of the price range for these dwellings, according to Home Care Suites, which built it. [Here’s the virtual tour of the house.]
The 88-year-old George had been living in nearby Plant City, Florida, close to another daughter. But as she slowly declined, Barker decided that moving her into the backyard made sense. A flood in her mother’s home, caused by a broken pipe, provided a convenient opportunity to take matters into her own hands.
Now Barker, who runs a web development business with her husband out of their home, can keep a close eye on her mother. Although George is developing cognitive issues, she still takes care of herself, is healthy, and takes no medications.
The beauty of separate living quarters, Barker said, is that her mother can “keep [her] own independence.” … Learn More