In the next 15 years, the population of Americans aged 50 and older will surpass 133 million. As the nation’s elderly population continues to accelerate, they will realize that there is a short supply of affordable, well-located and physically accessible housing. This is in part to a paucity of savings, excessive debt levels and a lack of assets.
All of this information comes from a joint study conducted by Harvard Joint Center for Housing Studies and the AARP Foundation, which released the findings of its report Friday. The two organizations also examined previous data to support their conclusion that not planning for retirement will be a major issue for future generations.
Looking at statistics from 2010, it can be found that 40 percent of Baby Boomers aged 60 and older maintained mortgage and consumer debt, such as auto loans and credit cards, which averaged out to be $7,200. In addition to this, it is projected that the amount of income that Baby Boomers will live on will be considerably less – the number of households aged 65-plus living on less than $15,000 a year will increase by 37 percent.
Right now, one-third of older Americans (50 and older) spend about 30 percent of their income on housing-related costs. This means that as the years go by then they will have to cut back on other budgetary items, including food, healthcare and retirement savings.
Although the cost of housing remains an important factor to consider, there is also another issue to assess: inadequate housing, a problem whereby homes that do not meet the needs of seniors. This can equate to several problematic issues for someone who is older and sicker: multiple floors, small doorways, several steps to enter the home and much more.
In order to avoid these troubles from exacerbating, study authors urged the government and families to address these concerns.
“Recognizing the implications of this profound demographic shift and taking immediate steps to address these issues is vital to our national standard of living,” said Chris Herbert, acting managing director of the Harvard Joint Center for Housing Studies, in a statement. “It is also incumbent upon policymakers at all levels of government to see that affordable, appropriate housing, as well as supports for long-term aging in the community, are available for older adults across the income spectrum.”
This year, there has been an influx of studies and reports looking at how retirement could become extinct in the coming generations. Most of the research has a common theme: Americans are not saving enough for retirement, many fear of outliving their retirement savings and healthcare will be the dominant expenditure for retirees.
“The burden for retirement savings is increasingly upon us as individuals, and people are aware of that,” Greg McBride, Bankrate’s chief financial analyst, told the Los Angeles Times. “The younger you are, the more of an ally time becomes. The power of compounding is most evident over long periods of time, and having a longer period of time for your retirement savings to grow and compound makes today’s contributions much more impactful.”
The economic collapse does indeed include the forthcoming retirement crisis.
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