Retirement And Aging Crisis – From Bad to Worse

Peter Grandich

For most of this millennium, I have been outspoken about the majority of American households living a lifestyle above what their finances truly can support (You must spend less then you make!). Increasing debt loads, and trying to keep up with the Joneses, have been a driving force towards a retirement and aging crisis, one that few in the financial services industry will even discuss because it is bad for business.

Traditional financial planning is a badly flawed process, and many retirement plans will fail to reach their goals. Why? For starters, the industry spends most of its time, chasing increasing net worth, and little time on the key to financial security – managing cash flow properly.

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I am very proud of my business partner for 25 years, David Suckey, and our team. David and I are part of a group that has over $1.6 Billion under management and provide us both with a support group second to none. Our alternative to traditional financial planning teaches how to maximize cash flow (that leads up to 40% more in savings with less risk) and not chase net worth that ultimately falls shorts for many.

Now more than ever, recognition of this dire retirement and aging crisis situation  needs to be addressed properly, ASAP.  Unfortunately, I won’t hold my breath for the “Don’t Worry, Be Happy” crowd on Wall Street to come to terms with it.

The retirement crisis originates from our current financial struggles. About two-thirds of U.S. consumers are living paycheck-to-paycheck. Total Household Debt rose to a new all-time high of $18.21 Trillion. The majority of Americans do not have a sufficient emergency fund, and one in four have none at all.

Consequently, many Americans are also not on track for their retirement. Far too many are at risk of being totally unprepared for retirement, and  have no retirement savings at all. The Social Security program is projected to deplete its reserves in 2034, which will greatly reduce retiree benefits. While the cost of retirement is persistently increasing, our savings are simply not keeping up.

 The financial situation of younger Americans is even worse. A study from the National Bureau of Economic Research found that millennials had less median and mean wealth than any similarly aged cohort in several decades. In fact, 70 percent of millennials are living paycheck-to-paycheck, which is more than any other generation. The verdict is clear — America is in a retirement crisis, and it’s not getting any better for younger generations.

  • A whopping 79% of Americans now believe a retirement crisis is looming, a sharp increase from 67% in 2020. Even more concerning, over half of Americans — 55% — are deeply worried that they won’t be able to achieve the financial security they need for retirement, according to the National Institute on Retirement Security.
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  • “Nearly half of today’s middle-class adults will be poor or near-poor in retirement.” – About 79% of people aged 62 to 70 can’t afford their pre-retirement living standards.
  • As America’s population of seniors grows, affordable long-term care is increasingly hard to find. Why it matters – Nearly 70% of older adults will need long-term care services, according to Harvard’s Joint Center for Housing Studies. Medicare doesn’t cover these services, and Medicaid often has long wait lists for at-home support.
    The cost of daily assistance at home is out of reach for most, and so is assisted living (which bundles housing and care together).
     Only 13% of adults 75+ in U.S. metro areas living alone can afford assisted living without selling assets. Only 14% can afford a daily visit from a home health aide along with their housing costs.
    For context, more than 40% of Americans 65 and older live alone. When considering seniors over 80, that share jumps to nearly 60%.There’s also a growing shortage of care providers. While most people prefer in-home care — and it’s cheaper for states to fund — not everyone can receive care at home. Many seniors require the resources and medical equipment at larger facilities.
    Last year, every U.S. state reported a shortage of care workers — and 43 of them saw permanent closures of care facilities, such as group homes and assisted living centers.The U.S. has at least 600 fewer nursing homes than It did seven years ago, according to a Wall Street Journal analysis.
    Nursing homes bore the brunt of the pandemic, leading many mentally and physically burned-out staffers to quit.The pandemic added fuel to that as more families pulled their loved ones out of nursing homes to limit exposure to COVID-19.
    Many facilities are struggling to stay afloat. 81% of them would need to hire additional workers to meet nursing staff requirements from the Centers for Medicare and Medicaid Services.

    Staffing shortages in nursing homes are hugely affecting those who need institutional care. U.S. life expectancy is on the rise. With that, care needs to last longer.

    A vast majority of older adults live in homes that they rent or own. The need for services and support — like housework, bathing, or medicating — is expected to increase sharply.
    Baby boomers had fewer children than older generations, making family help increasingly limited for aging adults.
    The combined costs of housing and daily care are beyond most people’s means.

    “It’s a wonderful thing that the older population is growing overall and people are living longer than a generation ago. But the supports that people need to stay in the community and their home are not only really expensive, but getting harder to secure.

Last but certainly not least, Canada and several U.S. States have embraced the most horrible path for dealing with an end of life crisis most still don’t even know about:

“Do not cast me aside in my old age; as my strength fails, do not forsake me.” – Psalm 71:9

“Do you not know that you are the temple of God, and that the Spirit of God dwells in you? If anyone destroys God’s temple, God will destroy that person; for the temple of God, which you are, is holy.” – 1 Corinthians 3:16-17