Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor

Retirement Planning > Social Security

Poverty Rates Drop for the Elderly

By John Sullivan

X
Your article was successfully shared with the contacts you provided.

The Census Bureau just reported a large increase in poverty in the United States. Driven by job loss and long-term unemployment, the poverty rate rose from 13.2% to 14.3%, as 3.7 million more Americans found themselves with incomes below the poverty threshold. Individuals aged 55-64 followed the national trend as they shared in job losses.

But, according to a new issue brief from the Center for Retirement Research at Boston College, those 65 and over saw a decline in their poverty rate. This outcome was the result of the timing of two different adjustments to reflect changes in consumer prices – an extraordinarily large cost-of-living adjust-ment (COLA) awarded to Social Security beneficiaries in 2009 and a decline in the index used to adjust the poverty threshold for 2009.

This pattern is likely to be reversed in the future as Social Security beneficiaries receive no COLAs in 2010 and 2011 and the poverty threshold increases.

“One could ask many questions about the measure-ment of poverty and the nature of inflation adjust-ments. But those questions go beyond the point of this brief,” Alicia Munnell, April Wu and Josh Hurwitz, the authors, write in the brief. “The goal here is simply to explain why, in the face of an enormous upsurge in poverty, poverty declined among those 65 and over. The answer is an unusual confluence of events in 2009, which will un-wind in 2010 and 2011, causing poverty rates to rise.”

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.