Despite modest increases in income and household assets for the “middle” 40% of older adults in the U.S., 80% of older adults in the U.S. would be unable to absorb a financial shock such as long-term services and supports, according to research by the LTSS Center @UMass-Boston. The study, conducted in partnership with he National Council On Aging (NCOA), was meant to highlight financial challenges and present potential solutions.

Researchers used data from the Health and Retirement Study (HRS), a well-respected and nationally representative panel study of middle-aged and older adults, to assess the financial security of Americans aged 60 and older.

The study revealed that the “bottom” 20% of older adults — a cohort of approximately 8 million households with a median income of $16,800—have no assets. In fact, some are in debt. These individuals are currently facing economic insecurity, and matters will only get worse as they age because many will need long-term care.

As far as solutions, researchers suggested the following:

1. Enrolling eligible individuals into state and federal programs as eligible older adults leave
   $30 billion in benefits unused each year.
2. Educate individuals about the best time to file for social security as 49% of pre-retirees
   underestimate their life expectancy by 5+ years.
3. Improve long-term care coverage as today’s 65-year-old has a 70% chance of needing some type of
   long-term care.
4. Empower homeowners to leverage their home equity wisely as home equity represents
   60% to 80% of most older homeowners’ total net worth.