Decline of median income stats are in – will anybody notice the 65+?

Consider the data, check elsewhere, and discard this report. This kind of thing catches my eye. You know by now which single age demographic income group saw a statistically significant increase in median income since the recession (supposedly) ended in 2007. The New York Times helpfully tells us – it was those 65-74 folk. Says the Times insightfully: “helped perhaps by the decision of some older workers to remain in the work force or re-enter it.”  A long way down in the article, we learn that the 5.1 percent increase for those 65-74 put them at a median income of $43,000 -- the national median rose to $52,100 in June -- even though in many cases the head of the household was retired. Guess those 65+ must be doing okay.

What is the real world view outside an age-baiting lens? Let’s mull that over a bit – and check out a few other stats -- because the way the Times phrased it, there is such an opportunity to pit age groups against each other.  The average retirement age today is 61 – and those not yet retired expect to retire after age 65. Ninety percent of those aged 65+ receive Social Security. The average monthly SSA retirement benefit as of July, 2013, is $1223.65 -- or $14.7K annually. Median retirement income of Americans aged 65+  in reality may have been closer to $31K, not $43K. Consider that 42% of the total who are aged 65+ are unmarried. Now consider how dependent older women are on Social Security income. Not good.

Now let’s look at cost of living increases from the senior primary income source.  Starting in the 2007 survey year, cost of living percentage increases from Social Security weren’t much – 2.3%, 2.8% and last year, 3.6 percent.  Ah, except for 2008, when SSA’s cost of living increase was 5.8% (presumably because prices rose the prior year) – the only year the COLA rose by that percentage since. So are seniors aged 65+ doing better than other age groups –- particularly if they are not working, as is the case for 80% of them?  Not exactly – and for the vast majority, they are not snatching jobs out of the hands of the young.  The rising price of food and energy from 2007-2012, when overlaid on top of the Consumer Price Index, is particularly striking for those between 65 and 74 who are not working. And savings for retirement seems framed in a lament of lost assets. This is not to minimize the pain of other age groups: suffering, unemployment, and under-employment are plagues across arbitrary demographic age bands.

Income statistics paint an aging population that may find products and services unaffordable. When you look at real income, study the actual saving levels, consider the actual cost of living and mull the lack of jobs for the baby boomer set – how well targeted are product and service offerings for these older adults? This is especially  true of senior housing – currently showing flat growth. How will those who need assisted living today pay for it – apparently the population who most needs it today can’t afford. Although prices are up each year, the industry has been stuck at an occupancy rate of 89% for many years – no doubt driven by the advanced age of resident move-in. But of even more concern, how will those who today are aged 65-74 be able to afford to pay for assisted living in the next 10 or 15 years? The houses they must sell may not recover their value for another 10 years and their incomes are not substantial enough to save their way in.