Price Hikes Abound At Nursing Homes And Assisted Living Facilities

A nurse holding the old man's shoulder and posing

The COLA increase coming in January to Social Security recipients will help, but some segments of senior spending are rising at alarming double-digit rates.  The Wall Street Journal recently ran a story on price-hikes at nursing homes, assisted living and other senior living facilities.  It featured an interview with Dan Gallo, who received a letter saying that the cost of his grandmother’s care would go up 10.2% effective on September 15 to be followed by another 9.7% increase in 2023.  “How many seniors can afford an immediate $750 a month additional to their monthly fixed budget?” he asked rhetorically.  Blaming inflation, the nursing home said it would start adding a $25 daily fee to cover inflation

Invest In I Bonds With Inflation High

A glass jar with retirement sticker filled with money

With the stock market extremely volatile and interest rates low, many seniors are trying to figure out what to do with their nest egg.  A nice safe investments are I bonds, which are U.S. treasury bonds which pays interest based on the consumer price index (CPI).  They currently are paying 9.62%.  Any I bond that you purchase from now through October will pay that rate for six months, at which point it resets.  You can buy up to $10K in I Bonds per year.

President Biden Signs Sweeping Prescription Drug Reform

Medicine tablets and capsules in containers

On August 16, President Joe Biden signed the Inflation Reduction Act which includes:

About $370 billion into policies aimed at reducing U.S. Greenhouse gas emissions.  $10’s of billions of dollars will go toward supporting renewable energy development, lowering the costs of electric vehicles, building out public electric car charging stations, etc.

The bill is the most significant prescription drug legislation to pass in 20 years. Diabetic seniors won’t have to pay more than $35 a month for insulin.  Starting in 2026, out-of-pocket costs for all prescription drugs will be capped at $2,000 a year for Medicare recipients.

Because the bill raises more revenue through higher taxes than it spends, it’s projected to reduce the federal budget deficit by close to $300 bill over the next ten years.

 

Social Security Payments To Leap In The Double Digits Come January

Group of older people showing thumbs up

Social Security payments are expected to rise by more than 10% next January given the soaring inflation that we have experienced.  Mary Johnson, policy analyst at The Senior Citizens League, cautions that this number may be too high, particularly if inflation cools later in the year.  The best case scenario : A huge increase in January while inflation cools to a reasonable level in 2023.

Inflation Soars To Level Not Seen Since 1981

U.S. consumer inflation hit 9.1% last month, a rate that we have not seen in more than four decades.  There’s good news and bad news here.  Seniors will get the biggest increase in Social Security than they have seen in decades.  And if you own your own home, you will be in a better financial situation than those who are renting because, as long as you have a fixed-rate mortgage, your payments won’t go up.  The biggest cost increase right now is gas, up 11.2% from the previous month and up 60% from a year ago.  This is followed by groceries, which are up 12.2% from a year ago.  Let’s hope that the Federal Reserve can get this economy back on track.

Inflation Driving Seniors Back Into The Workforce

A glass jar filled with dollars was placed on the table

Inflation in the U.S. hit a 40 year high of 7.9%, which is causing financial problems for many seniors.  Economists say that this is forcing many retirees back into the workforce.  Thankfully, this may ease staffing shortages which has hit a number of industries.  “We’re beginning to see the migration of the older cohort who expected to live on fixed income in a low interest-rate and low-inflation environment, Joseph Brusuelas, chief economist at RSM US LLP, told The Wall Street Journal.  “Really what you’re dealing with is an inflationary shock that has elicited a change in behavior,” he said.   The share of people over 55 either working or looking for a job rose to 38.9% in March from 38.4% in October.  That translates to more than 480K people in that age group entering the labor force during the last six months.

Seniors Got 5.9% Increase In Social Security, But It May Not Be Enough!

A glass jar filled with dollars was placed on the table

Seniors were happy to get a big increase of 5.9% to their Social Security payments this year, but it may not have been enough.  It was announced by the Bureau of Labor Statistics today that The Consumer Price Index rose 7.5% year-over-year in January.  That came in well above the median forecast of 7.3% from economists surveyed by Bloomberg.  It is the strongest consumer price growth since 1982!

https://www.businessinsider.com/inflation-cpi-january-price-growth-report-omicron-wave-supply-chains-2022-2?nr_email_referer=1&utm_source=Sailthru&utm_medium=email&utm_content=Business_Insider_select&pt=385758&ct=Sailthru_BI_Newsletters&mt=8&utm_campaign=Insider%20Select%202022-02-11&utm_term=INSIDER%20SELECT%20-%20ENGAGED%2C%20ACTIVE%2C%20PASSIVE%2C%20DISENGAGED%2C%20NEW