Photo Courtesy: Charday Penn / iStock
The costs of living are soaring, and property values are at an all-time high. Everything from the price of milk and eggs to the cost of fuel and taxes put a strain on our budgets in 2022. And for senior citizens who already live on tight, fixed incomes, these costs challenge where they can afford to live.
According to the Washington Post’s report on how inflation is impacting our senior population, “Rising prices are squeezing household budgets around the country and putting additional strain on its 56 million older residents ages 65 and older.” We’ve experienced the highest increase in the cost of living in more than 40 years. The sudden spike is poking holes in the fixed budgets of our senior community more than ever. The increased costs of living, paired with rising property values, make it difficult for them to continue renting, owning, or buying homes.
Like their tenants, landlords and property managers also feel the financial impact of inflation. To maintain their facilities and livelihoods, rent is expected to increase through most of 2023 before it moderates by November of next year. Because most citizens 65 years or older live on fixed incomes made up of retirement disbursements and social security checks, housing requiring more than 30% of that income puts them in a cost-burdened situation where life’s other necessities, like food and medical care, will suffer.
Senior Housing News recently addressed what seniors living in retirement communities can expect. “Senior living operators across the country are preparing residents for some of the most aggressive rate increases in industry history.” Why the aggressive increase? The owners and operators of these facilities and communities have to make up for what they are paying — and will continue to pay — due to increased taxes on higher property values and the rising costs of operating such establishments. So, they extend the expenses to their residents.
Renters aren’t the only over-65-year-olds feeling the financial burdens that come with the increased costs of living. Today’s costs of living affect senior homeowners, too. This is because, right now, property values are up everywhere. Per the Federal Housing Finance Agency House Price Index, home prices increased more than 17% in 2022 and aren’t expected to decline in the foreseeable future. Increased property values mean assessed property values are higher, which means property taxes will go up. Depending on where they live and how much they are able to save each month, senior homeowners may find themselves in a financial bind when they get that hefty property tax bill.
The older population in our country is growing, and they need food, shelter, and medical care like the rest of us. Knowing their age limits their wage-earning ability, it’s important to be aware of how and why inflation and increased property values are not welcome in their world. While Social Security benefits are set to increase by 8.7%, beginning with the December 2022 benefits, this won’t be the solution. Even with this slight increase in monthly assistance, the increased income could put those individuals in a higher tax bracket, negating the income bump. And as seniors age, they require more medical attention, so competing with the increasing costs to live, all while their health declines, feels like a losing battle.
For most of our country’s elderly, the safety net isn’t adequate enough to ensure they have a safe, reliable dwelling and the means to survive. Swallowed in the shadows of increasing values and inflation, their pensions and incomes diminish. To find out more about the devastating impact this issue is currently having on our senior community, check out NPR’s November 2022 report on why more older Americans are becoming homeless. And, to help the seniors in your life find affordable housing to avoid homelessness, learn more about the options made available to them by the government. These programs include:
- The Housing Choice Voucher Program helps very low-income families, seniors, and people with disabilities afford housing in the private market
- The Supportive Housing for the Elderly Program subsidizes independent living-type apartments for seniors
- The Eldercare Locator is a website that offers information and resources on housing options for older adults
Links
https://www.washingtonpost.com/business/2022/03/21/elderly-inflation-fixed-income/
https://www.hud.gov/programoffices/fairhousingequalopp/fairhousingacthousingolder_persons
https://www.fhfa.gov/DataTools/Downloads/Pages/House-Price-Index.aspx retirees-need-to-know.html