Understanding Elderly Poverty in the United States: Alternative Measures of Elderly Deprivation

There are two stories about the economic status of elderly people in the United States and both cannot be right. The first focuses on the great economic gains of the elderly in the last few decades, particularly compared to other age groups, and relies heavily on the official measurement of poverty. That story is misleading because it fails to account for changes in food and health care spending, changes in living standards for the average household and geographic variation in costs of living. Other measures of elderly poverty are more accurate and by incorporating the cost of basic needs these measures tell another story, namely that the elderly face increasing economic insecurity and deprivation. The “Great Recession†of 2008 – 2009 caused economic dislocation and more uncertainty across the board and only 13 percent of people approaching retirement age in 2011 reported feeling “very confident†that they will be able to “live comfortably†once they retire. The rest are postponing retirement or planning to work after retirement. As the proportion of elderly in the U.S. population grows, elderly economic issues are increasingly critical. This requires policy makers and groups that represent the interests of the elderly to understand and address elderly economic insecurity and vulnerability to deprivation. This report contributes to a broader understanding of elderly poverty and—with hope—better policy responses by examining the extent of elderly poverty using different poverty measures.