Odessa, TX – As inflation continues to spiral out of control, many of the American retirees and elderly are being dealt rising costs of necessities like housing, food, and gasoline pump prices.
Inflation can affect anyone’s budget – but especially when that person is retired or living on a fixed income. The Consumer Price Index has hit a 40-year high. The increase is the largest uptick since 2005 after Hurricane Katrina. Costs of goods and services are rising everywhere – from supermarkets to gas stations and even the housing market. Cutting back on groceries and rationing electricity hasn’t been enough for many of these people. Rent, food, and utilities are all becoming more expensive, making it tough for the retirees and elderly to make ends meet while trying to live off of their Social Security payments.
Many Americans are worried for their financial well being. Inflation has the potential to erode any worker’s paychecks, as more of their earnings are going toward the same expenses they were already spending on. People have been quick to note the high gas prices when fueling up their vehicles, or how their food costs have skyrocketed – whether they’re buying groceries or ordering take-out. Shoppers can see the increased prices at various retailers and vendors as well.
But just because inflation has hit a new peak does not mean everyone is affected in the same way. Where older Americans will feel a tightness from inflation is likely with their food, which has seen its largest increases since 1981 for meats, dairy, and food prepared outside the home. Beef products are up as much as 20 percent, but even those who try to curb their grocery bills will feel the effects of inflation – chicken prices are up 13 percent and eggs are up 11. Even dried beans, a source of “cheap protein,” are up 12 percent.
Someone relying on just Social Security, or who is trying to refrain from withdrawing from retirement accounts while the markets remain volatile, might find this high inflation worrisome. The average Social Security payment in 2022 is $1,400 or lower, which means those who use that sole income may have to take on extra credit card debt. Several low-income Americans, including those on Medicare and Medicaid, are having to go so far as forgoing expenses like medications and needed doctor visits in an effort to save money to stay afloat.
Rising prices are squeezing household budgets around the country and putting additional strain on its 56 million residents age 65-and-up, many of whom rely on fixed incomes and limited savings to cover monthly costs for prolonged and unpredictable periods. Americans in that age range are more likely to live in poverty than younger adults, Census Bureau data shows, with wide disparities by age, race and circumstance, including whether they rely solely on Social Security or have other sources of income.
The burden on older Americans is the latest example of how inflation is exacerbating inequalities across the economy. Higher prices on food, gas, and housing are weighing heavily on those who can afford the increases. Adding to the strain, millions of older Americans gave up regular incomes and retired early during the start of the pandemic.
Half of older people who live alone are struggling to get by. The steady climb of inflation has put further stress on retirees. About 18 percent of older adults live solely on Social Security. And although Social Security payments have built in cost-of-living adjustments, economists say there tends to be a 12-month lag between inflation and higher payments. This year, Social Security recipients received a 5.9 percent bump in their monthly checks even though overall prices grew just over 8 percent in the past year, according the Labor Department.
An estimated 15 percent of people over age 65 live below the poverty line, according to one measure by the Census Bureau. The situation, experts say, has become more dire with the added inflation growing out of control. Homelessness among seniors is rising rapidly and is expected to triple in the next decade. Experts also note that many pandemic-era programs, such as enhanced unemployment benefits and the expansion of the child tax credit, did little to relieve the concerns of older Americans.
Inflation can also eat into seniors’ budgets in hidden ways. Older shoppers are less likely to purchase online, where prices tend to be more competitive. Online prices are up 3.6 percent from a year ago, according to Adobe’s digital price index. Seniors living primarily off of Social Security payments also will have to wait until next year to hope to see another cost-of-living adjustment, where rent and grocery bills are skyrocketing and already an existing problem.
Hopefully, members of congress and state legislators will take heed in addressing these issues as the mid-term elections lie on the horizon.