As regulators and government agencies work to address the pending needs of a rapidly aging population in America, senior advocacy groups have been identifying the rising challenges that stem from a population that has saved little for retirement.
Yet the largest of those organizations says it still does not know what do do about the pending bubble of baby boomers who are approaching retirement age.
How to shape policy to accommodate the needs of this population is a major problem that remains unsolved, an AARP executive told a conference of aging professionals Tuesday.
Standing before 2,500 attendees of the American Society on Aging’s 2013 conference last week in Chicago, AARP Vice President of Policy Dr. Debra Whitman revealed what she called the “Unsolved Mysteries in Aging Policy.”
A pivotal focus of the “mysteries” are difficulties that the nation’s current health care system poses for an aging population in the years to come, specifically as it impacts retirement savings.
“Because it is far too common where people have not saved nearly enough for retirement, it is crucial to encourage more people to start saving earlier,” says Whitman, citing that nearly half of people over age 55 have saved less than $50,000 for retirement.
For those who have set aside enough, another challenge is ensuring that these nest eggs last when the money stops coming in.
“The sad truth is that many of today’s workers will not face the problem of managing a nest egg, because they are in danger of having none,” she says.
Postponing retirement provides one solution to sustaining nest eggs, suggests Whitman, as working longer can bolster finances in old age.
Even if more people decide to work longer, there still begs the question as to how Americans will pay for long term services and supports.
“There’s no escaping the fact that when boomers are older, the country will face a growing demand for long-term services and supports,” says Whitman.
The growing demand, she adds, poses serious financial challenge to individuals and families left to foot the costs, however, the current health care system does not allow any way to determine what these costs will look like.
“It is hard to design a more poorly functioning marketplace,” she says, urging that consumers need to be provided with basic information about what something costs or the quality of service.
What is even more disconcerting, she adds, is that under the current system, consumers cannot see the price before they buy.
A series of challenges lay ahead for what it means to age in America. Dealing with these challenges, suggests Whitman, calls for increased initiatives and pilot projects, even a change in perspective.
“We need to be more forward looking and proactive, and look at the aging demographic not as a tidal wave, but as something to welcome.”
Written by Jason Oliva