SoylentNews is people
SoylentNews
from the last-remaining-part-of-the-social-safety-net dept.
Personal bankruptcy among seniors has been growing over the last 25+ years, according to a recent study reported by the NY Times and syndicated nationally, for example at: https://www.seattletimes.com/nation-world/too-little-too-late-bankruptcy-booms-among-older-americans/
The signs of potential trouble — vanishing pensions, soaring medical expenses, inadequate savings — have been building for years. Now, new research sheds light on the scope of the problem: The rate of people 65 and older filing for bankruptcy is three times what it was in 1991, the study found, and the same group accounts for a far greater share of all filers.
Driving the surge, the study suggests, is a three-decade shift of financial risk from government and employers to individuals, who are bearing an ever-greater responsibility for their own financial well-being as the social safety net shrinks.
The transfer has come in the form of, among other things, longer waits for full Social Security benefits, the replacement of employer-provided pensions with 401(k) savings plans and more out-of-pocket spending on health care. Declining incomes, whether in retirement or leading up to it, compound the challenge.
Your AC's google-fu wasn't sufficient to locate the original report, but here is another quote from the Seattle Times link,
As the study, from the Consumer Bankruptcy Project, explains, older people whose finances are precarious have few places to turn. "When the costs of aging are offloaded onto a population that simply does not have access to adequate resources, something has to give," the study says, "and older Americans turn to what little is left of the social safety net — bankruptcy court."
"You can manage OK until there is a little stumble," said Deborah Thorne, an associate professor of sociology at the University of Idaho and an author of the study. "It doesn't even take a big thing."
To show that this isn't something new, here's an NPR report from 10 years ago, https://www.npr.org/templates/story/story.php?storyId=93241953
SEABROOK: So how does that play out for older Americans?
Prof. WARREN: Well let me put it this way. Back in 1991, older Americans, those over 55, were about eight percent of all the people filing for bankruptcy. Today, they're about 25 percent of those filing for bankruptcy. It's been a real shift in the demographics.
The median age and the population, generally, has increased by about three years. The median age in bankruptcy has increased in the same time period by about seven years.
Compare with the currently running story about wages and benefits climbing currently, https://soylentnews.org/article.pl?sid=18/08/05/016226
(Score: 2, Interesting) by Anonymous Coward on Wednesday August 08 2018, @09:42PM
Every option suffers from the same fatal flaw. Pensions, 401K, welfare like social security... all are, in some sense, the same: today's old people must be cared for by today's young people.
None of that can work reliably. When a surge of working people unbalances the system by supplying value, the costs of investments go up and the cost of labor goes down. When they become old, they all want to sell of their investments at the same time, and thus the value plunges. Meanwhile, there are few workers, so the cost of labor goes up.
The government can't really get around this. Mandating that labor stay cheap will just cause shortages. They could force people to work as slaves, but then the worker shortage causes labor costs to rise elsewhere in the economy. Mandating that the investments supply great value will just screw up the currency with hyperinflation.
Fundamentally, it is impossible to have investment success for a group like the baby boomers. This includes pseudo-investment things like social security. The money entered into the system doesn't really exist. Even if it were physically hoarded as piles of case, it wouldn't really exist because releasing the stores of cash would cause inflation. There just aren't enough workers.
You can't even import suitable workers. We get people who hate our culture, refuse to speak our language, and want our elderly to hurry up and die. These people are relatively unproductive and will themselves need care when they get old.
Robots? Oh, maybe... and Japan is trying it. Old people tend to want human contact. Robots are not anywhere near capable enough.