Solutions to Poverty Among the Elderly

Poverty is defined as having a meager annual income, insufficient for meeting basic expenditure. Research has confirmed that older adults, from the age of 65 years and above, when poor, confront immense burden in meeting with their basic housing, food, healthcare and other expenses. Poverty in the elderly populations is a persistent and grave issue in America. Almost 10% of elderly individuals (aged 65 years and above) belong to families with annual income below America's official poverty line, also termed as the federal poverty level (or FPL). An older adult (age- 65+) who lives alone was labeled as a 'poor' individual if his/her annual income before tax amounted to less than 10, 326 dollars, in 2008. Elderly couples having incomes under 13, 014 dollars were labeled as poor. Roughly one in every six elderly individuals was nearly poor, or poor, with income less than 125% of FPL; nearly a third of the elderly had low incomes -- less than 200% of FPL. A fact that we very often overlook is that 3.7 million elderly persons don't have adequate cash income for meeting their basic expenditures. Most common perception is that the issue of poverty among the elderly has largely been solved. Since 1968, the older-adult poverty rate has dropped by nearly a third, declining from 25% (in 1968) to 9.7% (2008). On the contrary, poverty among the younger adult population, and particularly among little children, has seen an increase in recent times even as gross domestic product (GDP) per capita, which signifies national prosperity, has risen. However, poverty -- especially among individuals aged 65 years and older- has been inaccurately measured; furthermore, poverty rates still prove to be excessively high, particularly in case of older Americans in specific communities-20% of Hispanic or black older adults are poor; also, poverty affects unmarried or inadequately educated older individuals rather severely. A majority of the elderly poor are not married (i.e. 43% of them are widowed, 19% are separated or divorced, and 8% never married). Older Black women are particularly likely to lead a life of poverty. Approximately 25% of older Hispanic or black women are poor, while over a third of them are nearly poor, or poor (i.e. having incomes lower than 125% of FPL) (O'Brien, Wu & Baer, 2010).

This report provides an informed overview of social work with elderly people with regard to what it is; why it is necessary; its aims; knowledge base and skill; populations and contexts where it functions effectively; and the level of evidence associated with its effectiveness. As well, the report addresses various key issues that affect social work when dealing with elderly people and provides a way forward which involves social work in order to meet the needs of elderly population (Milne et. al, 2014).

Remarkable progress has been made with respect to reduction of poverty rate among American elderly individuals. In the very first 10 years since an official poverty measure was adopted by the national government, the fraction of elderly poor declined at a dramatic rate, from 25%(1968) to 14%(1978). This abrupt drop in the 60s-70s was almost wholly because of the considerable increase in Social Security schemes in that period. Ever since, progress has become more gradual; the official poverty rate in elderly individuals has remained at approximately 10% over the last ten years. However, though the proportion of poor individuals in the age-group of 65 years and above has decreased in the last four decades, elderly poor persons' numbers have remained somewhat constant from the mid-70s onwards because of an overall growth in number of older adults (O'Brien, Wu & Baer, 2010).

Source: Older Americans in poverty: A snapshot

The median of poor older families spend 60% of their annual domestic incomes on housing, as per a 2008 estimate. In other words, housing expenditures are exceptionally unaffordable (using up over 50% of domestic income) for over half (56.9%) of elderly poor families. Upon utilizing a less limiting standard, over 75% of elderly poor families are faced with housing affordability issues, resulting in them spending over 30% of their domestic income towards housing, in the year 2008. Food can be said to be much less costlier, compared to housing, in poor elderly people's budgets, however, a growing number of near-poor and poor elderly families faced critical challenges in feeding themselves, as of 2008 (O'Brien, Wu & Baer, 2010).

Social Security, thus far, represents the biggest source of revenue for the elderly poor. In 2008, roughly, three-fourths of poverty- ridden households (with head of the family aged 65 years and above) received income via Social Security; the remaining one-fourth households did not report obtaining Social Security. The elderly poor households were highly unlikely to gain income through earnings (7.5%) or through pensions (7.8%). Around 14% of elderly poor households received income via Supplemental Security Income (SSI) or some other community assistance initiatives, and scarcely over 20% had income obtained from personal assets; however, the income received from assets (in individuals who acquired it) was trivial, usually barely over 200 dollars per annum. The elderly poor aren't just considerably less likely to acquire income from earnings, assets, pensions, etc. than those who are non-poor, but, generally, even in case they do derive income from these sources, the amount of income gained is lesser compared to that derived by non-poor elderly households. Social Security constitutes more than 75% of the domestic income of elderly low-income and poor households (persons with income less than 200% of FPL), with retirement savings, earnings, and community assistance (chiefly SSI) bridging the gap. Community assistance makes up a very trivial share of income of the elderly poor (8.3%), which reflects SSI's modest benefits and limited reach. Elderly poor persons depend heavily on SSI and other social security programs. Income statistics reveals that older households having minimal incomes rely much more greatly on such programs than higher- income elderly households. Social Security represents the lone income source for 45% of poverty-ridden older adults. Most elderly poor (59%) depict Social Security dependence for nearly all (90% or greater) of domestic income. Of the elderly who most greatly depend upon Social Security (i.e. 90% or above of annual income is social-security-dependent), 84% have low domestic income (less than 200% of FPL), however, most are not poor. 22% of the elderly were poor in 2008, but almost two-thirds had incomes lying between 100% and 200% of FPL (O'Brien, Wu & Baer, 2010).

As in the case of age groups other than the elderly, poverty doesn't impact older women and men equally. For women, an entire lifetime of lesser earnings arising from wage discrimination, jobs unlikely to provide employer-sponsored benefits for retirement, and absence from labor market because of childbirth, contributes to greater poverty. More than 2.3 million females aged 65 years and over (i.e. 11.5%) exist just at, or even below poverty line, whereas slightly more than a million (6.6%) of elderly males live a life of poverty. Roughly one out of every five (or 19%, to be more precise) of widowed, divorced or single women aged more than 65 years are poor; poverty risks for older females rises further with age. Women aged 75 years and above are thrice as likely as men belonging to the same age group, to live in poverty. The number of men below or at poverty line, belonging to this age group, is 416,000, while more than 1.3 million females aged 75 years and over are poverty-ridden. Among those women who are married, longer life expectancy of women makes them more prone to outlive their husbands, thereby leaving them without the added income brought into the family by men (Cawthorne, 2008).

Aging black persons are more prone to experience a life of poverty than whites (7.9% of American whites are poor). Social Security is a significant contributor in increasing incomes of numerous black individuals and taking their social status to 'above poverty line'. Older black persons are more unlikely to become recipients of private retirement plans and are much less likely to gain asset income, which includes bank account interests, investment interests, property rents, dividends, trusts and estates. Blacks constitute only around 9% of U.S. elderly population, and yet they make up 21% of the older adult population residing below poverty line. Roughly 25% of all older black American citizens are poverty- ridden. On excluding the financial benefits of all public initiatives from Black Americans' incomes, over 6 out of 10 Hispanic-American and African-American elderly would become poor. Upon counting Social Security, this rate slumps to around 3 out of 10. If incomes derived from other community programs are also included, 17% of Hispanic- American and 21% of African-American older adults remain poor. Asian-Americans' dependency on SSI and other public security programs is lesser, when compared with other older, black persons. However, a 12% poverty rate is observed in elderly Asians, which is still greater than the poverty rate of white-American citizens (Cawthorne, 2008).

Elderly people residing in rural areas show higher poverty rates than those in urban areas; furthermore, rural areas are likely to possess a greater share of older adults in their overall population, when compared to urban regions. This feature is because of a medley of economic demands that force younger individuals hailing from rural backgrounds to migrate and look for jobs in urban cities, and the trend of rural elders to remain in place and grow older. Rural persons are less inclined to depart from their homes after retiring, when compared to their counterparts in urban areas. Elderly rural residents may have lesser access to essential services and depend more heavily upon private means of transport (Cawthorne, 2008).

Though a considerable proportion of poor elderly persons have homes of their own, without any loans or outstanding mortgage (i.e. they mostly own houses "clear and free"), several poor elderly individuals are burdened with exorbitant housing costs. Over 50% of poor elderly families face extremely high-priced housing expenditures (i.e. their utilities and housing expenses exceed half the family income); housing expenses devour over 30% of domestic income in case of 80% poverty-ridden elderly households. The poor elderly are significantly more likely to reside in rental houses than those who aren't poor. As of 2008, 40.6% of poor elderly families (that is, households in which the head of the family is aged 65+) were renters, when compared with only 8.9% of older families with incomes over 400% of FPL. Approximately 5% of elderly poor families weren't paying rent in cash, but residing with others. A large percentage of poor (54.7%) are home owners, and a majority of these own homes "clear and free."

Whether poverty- ridden elderly people are owners or renters, housing expenditures are an overly expensive inconvenience for many. As per information obtained from the American Community Survey, in 2008, older poor families, on an average, spent 60% of their annual family income towards housing, which is a far greater share than is spent by families acquiring higher incomes. Poor elderly renters are, in general, more inclined to be encumbered with high housing expenditures than poor elderly homeowners are; however, the median housing expense was high in both classes. Property taxes, utility expenses and, in some cases, mortgage payments, consume an extensive share of poor elderly homeowners' income. Poor older adults who own homes 'clear and free' devote a lesser portion of their income towards housing than those who have mortgages to pay, but still, housing is an unaffordable affair for many. Median expenses from income for the elderly poor families who owned homes clear and free was 49% (as against 60% for all poor elderly homeowners). Housing expenses are, indeed, exceedingly unreasonable for over 50% of poor elderly families. In 2008, housing expenses surpassed 50% of family income for 56.9% of such families. In comparison, barely more than 25% of nearly-poor elderly households (having incomes from 100% to 199% of FPL) encountered acute housing expenditure burdens. Poor elderly people owning homes clear and free tend to be less encumbered by excessive housing expenses compared to homeowners having to pay off mortgages, or renters; nevertheless, 48.1% have to devote over half their yearly earnings towards housing expenses. Housing costs, which are more than 30% of family income (standard rent for a majority of rental housing schemes), are considered unaffordable. Over half of elderly households having incomes lying between 100% and 199% of FPL have to cope with housing affordability issues, as well.

Social workers play a role in starting and providing preventive interventions that improve elderly people's life and contribute to long-term financial savings. Assessment skills in social workers and particularly the capacity to recognize social, psychological and emotional needs and strengths imply they are well-equipped in exploring the goals for re-ablement for service users, when planning how to best achieve these and review the progress and outcomes. Community approaches are able to mobilize elderly people's skills, experience and expertise. Development of social enterprises can offer fresh opportunities for social work to engage in innovative activities that target the community (Milne et. al, 2014).

Social workers have the ability to make significant difference to elderly people who have complex high intensity needs and tend to be unwilling to engage with services. Social work skills for building trust, provoking understanding of the elderly person's wishes, evaluating options and expediting choice and control are essential in positive and justifiable decision making in old age; they also encourage dignity and autonomy (Milne et. al, 2014).

Abstract

Poverty in elderly individuals differs across states; however, as SSI and Social Security deliver consistent federal benefits, the proportion of elderly persons leading a life of poverty varies much less across America when compared with the proportion of children leading a life of poverty. In 2008, the proportion of the elderly population classified as poor ranged from 3.7% in Alaska (lowest) to 16.9% in Mississippi (highest).A majority of older poor citizens receive income through Social Security. Indeed, most (i.e. 59%) of the elderly poor are reliant upon Social Security, for almost all, or all, of their household income (that is, 90% or more). Moreover, while Social Security programs are generally large enough for preventing older persons from leading a life of poverty, a few only receive modest benefits, which aren't sufficient to safeguard them from poverty.

Problem statement

Reduction of poverty in elderly persons (aged 65+) must assume the status of a high-priority issue for state and federal policymakers.

Proposed Solutions

The elderly poor naturally possess little in the form of monetary assets. Some possess amassed savings (held, for instance, in retirement bank accounts), which may serve as financial backers; but the proportion of elderly poverty- ridden individuals having monetary of any significant value is small. Most poor older people are homeowners, but many have little home equity, as well as limited capacity, to draw on home equity for improving their living standards during their retirement age (Butrica, Murphy & Zedlewski, 2010). Poor elderly people are not just unlikely to possess any assets, but their assets may be less valuable compared to those possessed by non-poor elderly persons. In spite of a common opinion that the issue of poverty in elderly American citizens has mostly resolved, risks of, and challenges thereto, of poverty among individuals aged 65 years and above are substantial. Under a novel approach for assessment of poverty, roughly one out of every five elderly persons faces real material and financial hardships. These figures indicate that existing policy responses are not adequate. More efforts have to be put in for reducing the difficulties faced by countless older individuals. A part of tackling poverty among the older age group is placing the nation's youth on the path of fine jobs, which offer decent wages, retirement pensions, inexpensive and secure health insurance, and security against other forms of risks (which includes risk of disability). Nevertheless, the hardships and risks of poverty should also be dealt with, in case of persons who become poor as they grow older, due to culmination of career, disability, poor health, or other causes. Some of the options to decrease old- age poverty are as follows:

Improve SSI

SSI is the major monetary assistance initiative, which benefits older individuals belonging to poor populations. It has been a neglected instrument for long and has to be reformed for playing a more central role in alleviation of poverty among the elderly. Substantially increasing the current SSI asset limit from 2,000 dollars for a single person and 3,000 dollars for couples would alleviate the financial problems older individuals with very low incomes, eligible for financial assistance, have (Merlis, 2010). As 40% of older SSI receivers are estimated to be poor, policymakers must also consider improving SI benefits (possibly through expansion of income disregards), for uplifting of aging SSI recipients from the 'poor' status (Nicholas & Wiseman, 2009).

Improve Social Security

Social Security is responsible for lifting over a third of elderly persons out of a life of poverty (Caldera, 2009). Social Security schemes, however, aren't substantial enough for prevention of poverty after retirement for some individuals; these include women whose earnings and work histories are limited, people who've earned low wages throughout their work life, and those whose career is cut short due to infirmity in the days leading to their retirement. Addressing such vulnerable groups' needs requires an improvement in Social Security. For instance, a fresh minimum benefit may possibly target workers having low lifetime incomes and may offer compensation to workers who have to spend days out of jobs due to unemployment, poor health, or for caregiving purposes (Favreault, 2009).