A new study released by NORC at the University of Chicago finds that nearly three-quarters of American seniors will be unable to afford assisted living programs by 2033, excluding home equity wealth from the equation. However, even when home equity is included, less than half of seniors will be able to afford such care.
“A new NORC analysis updating the groundbreaking ‘Forgotten Middle’ study finds that there will be 16 million middle-income seniors in 2033, many of whom will struggle to pay for the health, personal care, and housing services that they need,” the results of the study read. “For instance, excluding home equity, nearly three-quarters of middle-income seniors in 2033 will have insufficient financial resources to pay for assisted living, if they need and want it. Even with home equity, nearly 40% will not be able to afford assisted living.”
The original “Forgotten Middle” study was published in 2019, a year before serious economic ramifications rattled Americans due to the following crises including the COVID-19 coronavirus pandemic, and the inflation surge resulting from global economic instability.
“This first-of-its-kind study examined how the number, demographics, health status, and financial resources of middle-income seniors would change in the coming decade,” the results say of the original work. “It demonstrated that many middle-income seniors are likely to have health and mobility needs and will not be able to pay for services currently available in the market without additional financial help from family members.”
NORC received support from the Long Beach, Calif.-based SCAN Foundation to take data from the 2018 Health and Retirement Study (HRS) and “reassess the income thresholds, health needs, and care solutions that are most pertinent in the current policy debate,” the results described. Several data points emerged from this exercise.
“In addition to nearly doubling in size, the middle-income senior cohort will be more diverse in 2033, with people of color comprising 22% of the group,” the results explained. “Many middle-income seniors will have health needs, like mobility limitations (56%) and cognitive impairments (31%), that make it hard to live independently. Without selling their homes, nearly three-quarters of middle-income seniors will have insufficient resources to pay for private assisted living.”
That figure comprises about 11 million older adults at or over the age of 75. Additionally, many of those same seniors may find that they will not be able to qualify for assistance programs like Medicaid either, further endangering their ability to find adequate care in older age.
Paragraphs by Chris Clow on reversemortgagedaily.com