Economic Status Of Older Adults

Front 1

Sources of income for older adults (3 legged stool)

Back 1

Social Security, Pension, Savings/Assets

Front 2

Definitions * of Income, Wealth, Net Worth =

Back 2

Income= available cash with purchasing power
Wealth : all economic assets of value regardless of whether produce cash
Net Worth: total assets minus total liabilities (debt, eg.)

Front 3

Genearal economic status of older adults (poverty rate? median income? net worth?)

Back 3

-Lowest poverty rate any age groups
-but, lowest median income
-highest net worth (houses)

Front 4

Retirement income needed to maintain lifestyle? (Is economic status cumulative over life course? Which age group has generally most sources of income)

Back 4

Economic status cumulative over life course:
-need 65-80% of preretirement income to maintain standard of living
-older adults more sources of income generally

Front 5

Retirement income pie charts sources:

Back 5

SS (38%)> Assets(23% > Earnings > Pension 10% > Govt pension > other

Front 6

Social security original intent:

Back 6

Defer income during working years, remove older workers from workforce (jobs scarce at time)

Front 7

Pay as you go system facts:

Back 7

you and employer pay 6.2% of wages each,
remainder of revenue put in trustfund
Retirement benefit is based on PERCENTAGE of your average earnings

Front 8

Social security benefit rules:

Back 8

-employed or married 10 years to be eligible
-max ben = 2185 / month, min = 1079
retirement ages slowly scaling up from early 62/65 full in 2000 to 62/67 full retire 2025

Front 9

Elderly couple SS rules:

Back 9

nonwork spouse = gets 50% workers bennie, 100% if widowed
dual-income household = lesser worker can get 100% hers or 50% of spouses

Front 10

Pensions (employer) info: (how many have, average $)

Back 10

supplement retirement income
25% covered in 50s now 45% today
Average pension is $5000

Front 11

Two types of pensions:

Back 11

Defined benefit vs
defined contribution

Front 12

Defined benefit pension pros/cons

Back 12

amt determined by: years of service, salary history, vesting rules (min yrs served)
+Company manages investments
+stable secure payout
-Not portable (only can take a portion)

Front 13

Defined contribution pension pros/cons

Back 13

amt determined by: what you contribute!, amt further matched by company usually
+you are responsible, and can take account to other companies/jobs
-Penalties for early withdrawal
-unstable in economy, only have whats in account

Front 14

Pension Benefit Guaranty Corporation

Back 14

Federal agency to protect pension when companies can't meet obligation
(currently $11 billion deficit, but at least DEFINED CONTRIBUTION IS MORE POPULAR)

Front 15

Personal savings for old age types, facts:

Back 15

-IRA, savings account, stock market, real estate.
-early saving is key
-Most people not saving enough (was only 8% in 1960, only 5% now)

Front 16

Assets types (esp in Old Age)

Back 16

(second most important source after SS)
can be House, or cash, savings, stocks, or investment properties
(home = majority of net worth)

Front 17

3 types of current earnings in old age

Back 17

= wages, interest on savings, or dividends on stocks/bonds
(not as big a factor since people work less, save less =( )

Front 18

Inequalities in retirement income (women and minorities)

Back 18

-lower SS benefits recieved
-lack pension coverage
-widows susceptible to poverty after loss of spouse

(overall also, too many older americans remain poor)