The average cost of senior living can range from $500 to $1500 a month, according to the United States Bureau of Labor Statistics. Seniors residing in assisted living facilities have a monthly average cost ranging from $1,500 to $3,500 a month. The average cost of senior living varies by state and region, but expenses are going up across the board for the basics seniors need every month. These expenses include rent, food, medication, and transportation costs. Add to that fees for typical utilities, such as gas and electric, and the cost of living for seniors quickly mounts.
Contributing Factors to the Rising Average Cost of Senior Living
Social Security recently provided seniors with a cost of living adjustment, the first after suspending annual adjustments due to budget issues for the previous two years. While this is good news for seniors, any real benefit of such an increase in Social Security benefits is offset by rising costs of medical care, energy costs and other related expenses. According to the AARP, more than 3 million seniors over the age of 65 live below poverty level. A growing number of seniors put off retirement or work part-time to supplement their income, according to recent Census figures based on reported income.
The recent mortgage crisis has taken its toll on seniors, with some falling behind in their payments and facing foreclosure. Add to that a fluctuating stock market, and it’s easy to see why an increasing number of seniors cannot rely on their nest eggs to bail them out of dire financial straits. Some seniors are turning to family members for help, but a less-than-robust economy is putting the pinch on everybody. It’s hard for family members who are struggling themselves to chip in and help their parents or grandparents.
Medicare cutbacks are adding to the expenses some seniors now have to absorb. Many doctors are reluctant to accept new patients since they do not receive the same level of reimbursement they did before. Social Security is consistently an economic priority, but the program is not expected to remain solvent forever as aging baby boomers join the ranks of an older population. Even seniors who depend on pensions are finding that many companies are not able to maintain monthly payments, with some filing for bankruptcy protection.
According to a recent study, a couple retiring today will need about $250,000 to cover expected medical expenses during their retirement. This is coupled with added living expenses and costs associated with housing and other necessary costs of living. Many agencies that provided some relief for seniors are cutting services. This means seniors have to find alternative services or absorb costs themselves. This often requires adjusting monthly budgets and cutting back on travel plans and other non-essential expenses.
A study involving people age 65 and older in California found that the average cost of senior living for a single senior was $23,910 a year. This includes the cost of rent, food, transportation, health-related services and other basic expenses. Some seniors have turned to assistance programs to pick up the slack. In California. a senior needs to have an income near the current federal poverty level of $10,200 to quality for most assistance programs. This often puts seniors in the position of making too much to qualify for assistance, yet not making enough to cover all necessary expenses each month.
The average Social Security income for a couple is just under $22,000. The average cost of living for a senior couple is nearly $10,000 more than that. The median income for retirees is nearly $17,000. Again, a number that falls short of expected expenses. The solutions offered are usually tied to federal and state funding. Nationwide budget crunches are reducing the money available for programs aimed at helping seniors. This means that some seniors can no longer rely on state and federal programs to cover added costs. It seems to be a no-win situation for some seniors struggling to stay afloat in a sea of economic uncertainty.