Overcoming Low-Income Seniors’ Financial Challenges

People over the age of 50 with low-to-moderate incomes are facing an increasingly intense and unique set of financial challenges as traditional late-life retirement funding options, like an employer’s pension, become less available. This is according to a study conducted jointly by the Center for Financial Services Innovation (CFSI) and the AARP Foundation, the charitable arm of AARP.

Among the biggest financial hurdles needed to be overcome by older Americans, CFSI has identified five major challenges that specifically emphasize how the monetary landscape for older Americans has changed: a shortfall in savings, the larger burden of debt, inadequate protection from sudden medical issues, an inability to retire completely and the positive and negative ramifications of family obligations.

According to the survey, 51 percent of individuals struggle with insufficient, short-term savings, while 39 percent report having unmanageable debt burdens. Many people over age 50 also experience significant financial consequences stemming from an unexpected medical expense, and the inability to completely retire exacerbates already-difficult financial struggles. Even for those who do manage to stop working, the survey finds that they still struggle with maintaining financial health.

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The presence of all of these financial burdens also presents some business opportunities, however. CFSI also reports that many Americans over 50 are open to the larger incorporation of digital technology into their lives, including the ability to monitor and pay their bills online, and the willingness to incorporate different kinds of online banking tailored to their individual levels of comfort related to the security of personal information.

“The [low-to-middle income population age 50 and over] face dynamic and complicated financial health challenges that challenge our understanding of what kinds of products, tools, and engagement models they really need,” CFSI notes in their survey’s blog post. “These 50 million individuals represent both an urgent need and a substantial opportunity for financial services providers to offer better products, programs and tools.”

Read CFSI’s full post at Medium.

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