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On Aging with Dr. Roger Branch Sr.: Why are so many seniors living in poverty?
Branch WEB
Dr. Roger Branch Sr.

People who are old and also poor are often noted in these columns. Well, that's proper. A lot of older people do live in poverty, and the number is growing. Where do they all come from?

Some seniors have been poor all or most of their lives. They have been either physically or intellectually challenged since birth or because of youthful injuries or diseases. For whatever reason, they have been in low-paying jobs or sporadically unemployed. They worked in seasonal or part-time jobs because of a lack of education, necessary skills or motivation. They might have worked "under the table" and thus received no Social Security credits. Few were employed by those who offer savings plans.

So, when these people, who never had much, grow old, there is little or no Social Security and no savings. There are many who worked hard from childhood on but never had anything. In time, they become poor old people, if they live long enough to be counted as old. (The average death rate among the impoverished - young or old - is higher than those who are not as poor, for obvious reasons.)

There are also millions of people who became poor because they got old. Start with those who were getting by reasonably well as long as they were working. Regular paychecks were adequate, if just barely. Then came retirement. Federal law forbids firing because of age, but some employers find ways to get around the law. Moreover, disabilities pile up with most people as they age. So, they retire. Many retirees discover that their income drops dramatically. If they have not saved, and too few have, they find themselves trying to live on Social Security checks.

That does not work. Social Security was never designed as the sole source of support for retirees but rather as partial funding to be used with other income. At the outset, people in some occupations were exempted from paying into Social Security: farming, farm labor and other seasonal work, the ministry and others. Over time, most of these have been brought under Social Security, but retirees have often paid so little into the fund that their monthly check is skimpy. Age has put them into poverty.

Seniors often find that in-the-bank savings are not so big after all. Home insurance, health insurance, property taxes, vehicle taxes, health care not covered by insurance, helping needy family members and friends, "paying the preacher," fixing the aging auto or buying another - these are just some things that gobble up savings and Social Security checks.

Here's a biggie: nursing homes. If it is necessary for a senior to enter one of these, by whatever name the operators choose to call them, he or she soon learns that Medicare does not pay for this service. Payment comes from the resident's Social Security check and personal resources, such as money in the bank. Once all personal resources have been exhausted (called "spending down"), the person is in poverty and on Medicaid. If he or she owns a home at his or her time of death, the government slaps a claim on it and claims some or all of the proceeds from its sale to pay for money advanced by the government to pay for nursing home services. A surviving spouse gets to keep the house and pay taxes and so forth until his or her death.

I remember "Tony," who had worked hard and saved diligently. He was proud of the amount of money he had saved and confident that it was plenty for his remaining days on earth. And it was enough for 30 years. Then he had to go into a nursing home for care. Three years there ate up his Social Security checks and all of his savings. The process to make him eligible for Medicaid had begun. Fortunately, he died before learning that he had slid into poverty.

Even apart from the election, there have been interesting things in the news in the last couple of days. One study led to the conclusion that people in this country do not start saving soon enough and do not save enough when they start. Add to that the fact that since the Great Recession began, interest on savings has been pathetic.

Another story revealed that the cost of living raise on Social Security checks will grow by three-tenths of 1 percent and that the amount withheld will eat that up and more. Folks in Washington decide on the items used in the formula to determine cost of living, and they change it now and then. At present, gasoline is part of that formula, and the price of gas fell this year. Therefore, they say that the rise in the cost of living was very small. What percentage of seniors have automobiles, and, if they have one, do they drive a lot? Why do they not weight that formula with things that retirees buy a lot, like health care, medicines and insurance?

Small wonder that aging drags people into poverty.

Roger G. Branch Sr. is professor emeritus of sociology at Georgia Southern University and is a retired pastor.

 

 

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