Improving the lives of older Americans
The Economic Downturn's Impact on the
Financial Security of Older Adults
AIRS CONFERENCE
May 2010
Presented by:
Ramsey Alwin, Director of NCOA’s Economic Security Initiative, NCOA
Velma Smith, Sr. Executive Director of NY/VT/OH, PathStone Corp.
Overview

Provide demographic profile of economically disadvantaged
older adults

Introduce a new national initiative using a person-centered
approach to alleviate economic insecurity

Explore PathStone’s approaches to implementing a holistic
approach
2
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© 2009. National Council on Aging
Profile: Economically Disadvantaged
What: Identified economically disadvantaged older adults
measured by % of federal poverty level (FPL) and risk factors for
economic insecurity
How: Using 2008 American Community Survey (ACS) and the
2008 Current Population Survey (CPS) Annual Social and
Economic Supplement (ASEC) data for profile and secondary
sources for risk factors
Why: To target services appropriately to those older adults most
at risk for economic insecurity
3
Source:
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© 2009. National Council on Aging
Trends and Research Findings

31% of adults 65+ struggled to get by on income below 200% FPL

Women fared worse than men with, 38% economically
disadvantaged compared to 23% of men.
• White women comprised 50% of those below poverty; and
• 50% of Black women had income at or below 200% of FPL.

Communities of Color were disproportionally represented.

If net worth were figured into poverty estimates, the
racial/ethnic gap in poverty would widen.
4
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© 2009. National Council on Aging
Employment
In 1990, only 42% of men and 28% of women ages 62-64 were
in the labor force; by 2008 the rates had risen to 52% of men
and 41% of women.
 Due to the recession, 44% of workers age 50+ have delayed
retirement.
 The unemployment rate for age 55+ is at an all-time high (7%)
with it taking on average 7 months to secure employment.
 Inequities in employment trends persist:
• In 2008, 56% of Blacks age 55-64 were in the labor force
compared to 66% of Whites of the same age; and
• Among age 55+, Hispanics had the highest unemployment
rates (12.6%) during the peak in July 2009.

5
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© 2009. National Council on Aging
Savings and Debt

Due to the market’s decline, the Dow lost more than 50% of
its value, and the value of equity assets in workplace
retirement funds fell by $4 trillion.

96% of Americans age 65-69 with income below the poverty
threshold possess retirement savings of less than $10,000.

According to a study released in late 2009, low- and middleincome consumers age 65+ carried $10,235 in average credit
card debt in 2008.
6
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© 2009. National Council on Aging
Medical Costs

Between 1999 and 2008, premiums increased 119%, exceeding
34% growth in wages and 29% rise in inflation.

In 2006, almost 50% of older adults in the lowest third of the
income distribution devoted one-fifth of their annual income
to medical costs, including premiums, deductibles and other
services not covered by Medicare.

Uninsured adults age 55-64 made up 9% of those without
insurance in 2008.
7
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© 2009. National Council on Aging
Housing

Housing costs in excess of 30% of one’s income can jeopardize
economic security. In 2008, this was the case for:
• 30% of homeowners 65+;
• 54% of renters 65+; and
• 41% of households 65+ in the Northeast.

During the recession, declines in home value ranged
depending on region with highest declines in CA and AZ
• Highest metro area: Los Angeles (-31%)

In 2008, individuals 50+ represented 28% of all foreclosures
and delinquencies.
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© 2009. National Council on Aging
Thresholds by Race/Ethnicity, Gender & Age 65+
United States
2008
White Women
White Men
Black Women
Hispanic Women
Black Men
Hispanic Men
Asian Women
Asian Men
AIAN Women
AIAN Men
Total 65+
At or
below
100%
FPL
12%
5%
24%
20%
12%
12%
12%
9%
19%
12%
10%
At or
below
200%
FPL
37%
22%
49%
43%
34%
35%
28%
27%
46%
30%
31%
Number at
or below
200% FPL
6,824,000
3,107,000
968,000
522,000
431,000
301,000
210,000
143,000
40,000
29,000
11,764,000
Below Elder
Index
Below 60%
Median
(169% of FPL)
(119% of FPL)
32%
17%
45%
39%
29%
30%
24%
21%
40%
29%
26%
30%
16%
43%
38%
28%
29%
23%
20%
38%
28%
25%
9
A non-profit service and advocacy organization
© 2009. National Council on Aging
Age Matters: Income Under 200% of the Federal Poverty
Threshold by Age, Race/Ethnicity & Gender, US, 2008
70%
65+
75+
60%
50%
40%
30%
20%
10%
0%
AIAN
Black Hispanic White
Women Women Women Women
65+
40
968
522
6,824
75+
16
485
246
4,246
Black
Men
431
183
AIAN
Men
29
14
Hispanic
Men
301
107
Asian
Asian
White
Men
Women
Men
143
210
3,108
71
93
1,686
(numbers in thousands)
10
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© 2009. National Council on Aging
Geography Matters:
States & Cities with the highest number of older adults living below 200% FPL
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Number
State
65+
CA
721,153
FL
647,576
NY
562,114
TX
533,694
PA
439,821
OH
361,979
IL
338,167
MI
282,304
NC
271,820
GA
222,059
TN
202,820
NJ
201,469
MN
187,459
IN
187,150
MA
182,809
VA
179,893
AL
166,935
WI
163,537
SC
139,632
LA
138,121
Note: 9 of the top 20
states are in the South.
Top Ten Metropolitan Areas with Vulnerable Older Adults 65+
65+ Householders
below 200% of
FPL
New York Metro
LA Metro
Chicago Metro
Miami
San Jose, CA
Detroit
Dallas
Tampa
Cleveland
Houston
Number of
Households
566,990
342,550
213,279
211,650
136,639
133,164
101,629
99,823
96,882
90,962
All
34%
32%
33%
40%
27%
32%
30%
34%
37%
33%
Highlighted cities are economic security service center sites.
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White
30%
30%
29%
39%
23%
30%
27%
34%
35%
28%
Black
45%
39%
49%
50%
40%
42%
53%
42%
52%
49%
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© 2009. National Council on Aging
Summary: Risk Indicators and Profiles
Those living most at risk for economic insecurity by all
measures include:
 Individuals 75+
 Communities of Color
 White Women
 Hispanic Women in the Northeast
 Black Women in the South
 American Indian & Native Alaskan Women 75+
 Individuals Living Alone
 Individuals with Housing Costs that Exceed 30% of Income
12
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© 2009. National Council on Aging
Survey: National Association of State Units on Aging
July 2009
Nearly
80%
60%
Over 50%
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© 2009. National Council on Aging
Limitations to Current Assistance

Older adults with serious economic needs often cannot get a
comprehensive review of their financial situation and gain an
understanding of various public and private services that my help,
including:
•
•
credit/debt counseling and consolidation,
foreclosure and bankruptcy assistance, and
• timely and appropriate information regarding leverage home equity.

Services are generally not coordinated and often unresponsive to
seniors.

Cold referrals with little or no follow-up.

Resources for “economic casework” are often inadequate or nonexistent. If in place, focused on “moving out of poverty” as opposed to
“toward economic security.”
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© 2009. National Council on Aging
BETTER COORDINATION OF COMMUNITY SERVICES COULD HELP
ADDRESS ECONOMIC SECURITY NEEDS OF OLDER ADULTS
Eligibility and enrollment assistance
Public
 Emergency assistance for
housing/fuel/food
Benefits

Employment training
 Skill assessments
 Job placement

Jobs
Credit counseling
 Debt management
 Daily Money
Management
 Financial literacy
 Pre-lender HUD
certified Reverse
Mortgage counseling
 Consumer
protection/financial
abuse
 Guardianship
 Representative Payee

▪ Home and
community-based
services
Aging
Network
▪ Nutrition programs,Services
transportation, etc.
Foreclosure
counseling
 Home repair
Housing
 Housing options
counseling
 Renters assistance

ECONOMIC
CASEWORK &
SERVICE
COORDINATION
Finances
Legal
Services
Health
Health insurance counseling
 Health promotion and disease
prevention

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 Debt and lost pension services
 Eviction prevention
 End of life decisions
 Assistance securing benefits
© 2009. National Council on Aging
Goals of the National Multi-Site Demonstration
 Produce a “proof of concept,” that is, that holistic person-centered economic
assistance services for older adults are found feasible and increase economic
security;
 Institute holistic person-centered economic services in eight to ten pilot
communities with established plans for sustainability;
 Serve 5,000 low-income seniors and help them to achieve greater economic security;
 Engage national organizations and ensure that project learnings drive public policy
recommendations and plans for program replication and scaling; and
 Develop a shared increased understanding of:
 the demand for economic assistance by seniors;
 what it takes to develop, operate and finance various service models;
 the needs not resolved through these services; and
 baseline expectations regarding the investment and the return.
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© 2009. National Council on Aging
Closing the Gap
47% of
economic
security
62% of
economic
security
A non-profit
andOpportunities
advocacy organization
For more information,
visit service
Wider
for Women – www.wowonline.org
© 2009. National Council on Aging
Forging a Pathway to Economic Security
Since 2001, BenefitsCheckUp® has helped over 2.3 million people find over
$7.3 billion worth of the annual benefits. The average person age 65 and older
with an income of 125% of the federal poverty level (FPL) was eligible for and not
receiving public benefits valued at $6,985 annually.

According to NCOA Reverse Mortgage Counseling research, the average lowincome homeowner was found to be eligible for about $5,000 in public benefits
and also qualified for a reverse mortgage that provided about $5,832 annually.

In 2007, almost 80% of older households owned a home and almost 65% had no
mortgage. Although, about 13.2 million older adults are likely candidates for reverse
mortgages, only 2% of older homeowners have drawn upon reverse mortgage services to
date.

Health insurance counseling is another service that can save seniors money. In
2006 older consumers averaged out-of-pocket health care expenditures of $4,631.
Older Americans spent 12.7% of their total expenditures on health, more than
twice the proportion spent by all consumers (5.7%). Many consumers could save
money by shopping more wisely for Medigap and Medicare Part D coverage.

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© 2009. National Council on Aging
NCOA’s National Economic Security Initiative
INPUTS
ACTIVITIES
Financial support of $3 million
over 3 years (Weinberg,
Atlantic Phil, SCSEP, local
cash match).
Multi-Community Initiative
Collaboratively develop, implement, and evaluate 12 innovative
community-based interventions to address the economic
security needs of at least 5,000 older adults
Current NCOA Benefits
Outreach and Enrollment
efforts, Policy & Advocacy
Capacity, BenefitsCheckUp®,
and Civic Engagement
Models of Significant Service.
Corporate Sponsorship
National Strategy and Vision
• Convene national aging organizations to support local
demonstration projects and to make recommendations for
policy changes that will more holistically meet the needs of
seniors affected by the economic downturn
• Explore short-term and long-term policy and funding initiatives
Leverage: Networks of
community partners and
service organizations
providing benefits assistance,
job training and other direct
assistance to low-income
seniors.
• Inform national policymakers
Decision Support Services
Beta test an “EconomicCheckUp” technology to enable a
person-centered assessment
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© 2009. National Council on Aging
Economic Security Service Center: Pilot Communities
National Multi-community Demonstration - Supported by Weinberg
• Baltimore – Creating Assets, Savings, and Hope (CASH) Campaign
• Chicago – AgeOptions
• Cleveland – Department on Aging
• Detroit – Area Agency on Aging
• Los Angeles – Insight Center for Community Economic Development
(in partnership with the AAAs in the City & the County)
• Milwaukee – Aurora Family Services with the Department on Aging
• New York City – Lenox Hill Neighborhood House
• Tucson – United Way of Tucson and Southern Arizona
SCSEP Resource Centers - Supported by DOL Stimulus
• San Francisco, CA
• Trenton, NJ
• New York State – PathStone Corporation
• Alexandria, VA
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© 2009. National Council on Aging
Help Create Economic Security—Share Ideas Online!
Share Your Big Ideas on The Exchange
(AgingExchange.org)
How can we make economic security
a goal of the Older Americans Act?
• Post your ideas.
• Read and vote on others’ ideas.
Trade Practical Tips on Crossroads
(NCOACrossroads.org)
Share lessons learned—and referrals to other
service providers.
• Meet colleagues nationwide who you can call on for help.
• Get their advice on your day-to-day challenges.
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© 2009. National Council on Aging