Our aging population, money and sharing
By Dian Vujovich
I recently asked a retired CEO friend of mine what he thought life in America is all about these days. He said, âItâs all about the money.â And heâs right. Money, however, isnât as plentiful for most as it is for a few. Nothing new there. But given Americaâs changing demographics, that could spell trouble in the not-so-distant future.
The Baby Boomer population is said to be growing by 10,000 individuals a day. Thatâs a number not to be dismissed. In fact, there are currently 62.83 million Americans age 60 around today, according to the Census Bureau. Compare that with the number of people under the age of 15— 61.09 million— and youâve got a first: Itâs the first time those over age 60 have exceeded those under age 15 in U.S. history.
That matters on a number of different fronts. The most vital is how to pay for our own personal aging life.
In a recent blog, I wrote my down-and-dirty formula for calculating how much money one will need to retire. Itâs simple multiplication: Take the amount of money it costs you to live each year and multiply it by the number of years you think youâll live.
I know that formula is likely to make financial advisors cringe and all sorts of professionals say that life during oneâs retirement years isnât as expensive as those in pre-retirement years but to that I say, “Hogwash.”
While retirees might not need things like an expensive wardrobe or the high-end footware they once did (walking in platform Jimmy Choo shoes isnât nearly as likely at 67 as it was at 45), what trumps looking good is the high cost of health and nursing home care.
According to Fidelity Investments, a couple 65 years of age and on Medicare will need an average of $220,000 for medical expenses during their retirement. Throw in the cost of nursing-home care— pros say averages over $50,000 a year, a figure I consider low— and those who think the retiring years arenât expensive simply arenât thinking.
Whether youâre a bajillionaire or not, living a long life in todayâs America is more expensive than itâs ever been. Prepare for it. And once youâve accomplished that goal for you and yours, consider helping others.
With a disjointed personal and corporate tax system, a way too huge financial gap between the wealthy and the working poor, a smaller work force and tens of thousands of people with little saved for retirement, the future of a thriving America will depend upon our ability to do one thing: Share.
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