For senior couples who struggle to make ends meet and scratch their heads wondering why, here is some affirmation of that painful puzzle: According to the Center for Social and Demographic Research on Aging [part of UMass Boston] Vermont’s cost of living outpaces their ability to keep up. For the elderly who are single, we rank third nationally in the percentage who are “economically insecure.” For elderly couples, we rank number one.

Yea.

It’s not that Vermont has a high percentage of its seniors [singles and couples] who have below poverty level incomes, we don’t. But we have a high percentage of seniors — roughly a third — who live in the “gap” between having too much to qualify for help and too little to live economically secure lives.

Once again, Vermont is not an outlier, we have a lot of company, states that suffer from the same challenges, and, as a region, the northeast dominates. For seniors living alone, Massachusetts, New York, Maine, New Jersey, Rhode Island and New Hampshire, join us in the top 10 club. For couples, we’re joined by New York, Massachusetts and Maine.

The study doesn’t categorize the expenses in any great detail, but we know from prior studies there are few areas in which are costs are less here than elsewhere. Fuel costs more here, so is food, and entertainment.

For the center’s purposes it made note of housing and health care costs. For elderly couples without a mortgage [fist bump], they need roughly $41,000 in income to make ends meet. For elderly couples with a mortgage, they would need an extra $5,000 to $10,000 yearly. Keep in mind that, according to a recent Harvard study, roughly 40 percent of the senior population still pays a mortgage and as the percentage of the elderly increases, that percentage increases as well. To add to that, the median amount these same seniors owe has almost doubled from $44,000 in 1998 to $82,000 in 2012. A fair percentage of that number have loan-to-value ratios that put them close to default, ratios high enough that banks would no longer lend to them.

This challenge is compounded when it’s understood the median net worth of households in this age cohort is roughly $200,000. That $200,000 includes the home’s value, which, on average might constitute roughly 30 percent of the net worth number. That leaves $140,000 in savings, pensions, or investments. Historically, the average return on investments has been roughly seven percent, which, on $140,000 is $9,800. This, plus Social Security, is what gets the researchers to the mid-40s as to what’s necessary to be financially secure.

Which is why it’s understandable that Vermont’s senior citizens are acutely aware of the price of things, particularly health care. According to the UMass study, the elderly in the U.S. spend, on average, $395 per month on health care. Vermont’s seniors spend $586, which is a 48 percent difference; that $2,300 would make a huge difference to those Vermont seniors living “in the gap.” That $2,300 represents what the average retired couple spends for food over five months.

These numbers explain the importance of Vermont’s decision in 2018 to exempt state level taxes on Social Security for those single filers making less than $45,000 yearly, and for couples filing jointly with incomes below $60,000. [The tax break is phased out at $55,000 and $70,000 respectively.] The UMass study’s numbers show that the numbers should be raised; we’re one of 13 states that tax Social Security benefits at some level, there are 37 states that do not. Vermont needs to join the majority. We have few tools that would address affordability as immediately or efficiently. In this case it’s easier to increase our seniors’ income than it is to reduce their costs. The vast majority of this revenue would also be spent in Vermont, for obvious reasons.

The UMass study also shows why the issue of affordability rings so consistently. It details the challenge faced by some 60,000-plus Vermonters. For many of these Vermonters they have few choices. And when winter strikes early, as it has this year, the accompanying hike in fuel costs has a real impact.

The sad irony of it all is that these are people who are not defined as poor; they’ve worked hard their entire lives and saved where possible. They’ve raised families and have decided to stick around and not flee to states where their retirement dollars will go further. They are the silent among us who have been put at risk by forces beyond their control.

If the report holds no other value than to focus our attention to this cohort, it was worth it.

by Emerson Lynn

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