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America’s overall poverty rate declined last year as household income reached a record high, according to a newly released US Census Bureau report. For older Americans, however, the financial picture moved sharply in the opposite direction.

Poverty among Americans age 65 and older increased for the fifth consecutive year. An AARP Foundation analysis found that the rate has climbed roughly 45% since 2019, leaving older Americans with the highest poverty rate of any age group.

The increase translates into 10 million seniors living in poverty, compared with 5.1 million seven years ago. The scale of that rise stands apart from the broader improvement recorded across the country.

“No other age group has seen that same pattern, and that should really stop us in our tracks. It's alarming,” AARP Foundation president Claire Casey told Yahoo Finance.

Even the official poverty threshold presents a stark financial challenge. For a single renter, the poverty line begins at just over $19,000 annually, an amount that must cover housing, food, utilities, healthcare, and other basic costs.

“Imagine trying to cover rent, groceries, utilities, and healthcare on that,” Casey said. Last year, poverty rates were higher for women over 50 than for men, while the poverty level among women age 65 and older approached 17%.

Casey described that figure as “really astonishing and something we should all be paying attention to.” The financial pressure facing older women often reflects circumstances that accumulated throughout their working lives.

“Women often reach retirement after a lifetime of lower earnings and less opportunity to save,” said Dan Doonan, executive director of the National Institute on Retirement Security. “Poverty in later life can be the result of these risks piling up — not bad decisions.”

The deterioration often begins before traditional retirement age. More than 7 million Americans in their 50s and early 60s are already living in poverty, according to Casey.

“Many of us think of our 50s as a person's peak earning years, when they're at the height of their professions,” she said. “But when you break down the census figures and look at the cohort just before the traditional retirement age, those 50 to 64, the numbers tell a different story.”

A single financial disruption can produce consequences lasting for years, Doonan said. A market downturn, health problem, or caregiving expense can consume available resources, while women who live longer may need to stretch whatever remains across many years, often alone.

Access to retirement savings remains limited among vulnerable workers. Only one in four older adults with low incomes has access to a workplace retirement savings plan, and few earn enough to contribute, according to AARP Foundation data.

Nearly half of Americans report having less than $100,000 saved for retirement, including nearly two in 10 with no retirement savings. The cited barriers include healthcare expenses, inflation, long term care, debt, and wages that have failed to keep pace with costs.

Many older Americans consequently depend on Social Security to meet basic living expenses. A low wage worker retiring at 65 would receive just over $15,000 annually in benefits, according to the Social Security Administration, which is below the federal poverty line for a single adult.

“You can work your whole life, do everything right, and still age into poverty,” Casey said. Although Census data trails current conditions, elevated inflation and soaring gasoline prices have added pressure for seniors already struggling to remain financially secure.

One third of older adults with low incomes could not cover a $100 emergency expense using savings, up from 28% in the spring, according to AARP research. More than half could not cover a $500 emergency, with people between 50 and 64 showing the strongest financial strain.

Nearly two thirds of employed older adults with low incomes report at least one additional source of paid work beyond their primary job. The extra work reflects the lengths many are taking simply to cover their expenses.

“It is no surprise that the elder poverty rate is rising,” said Teresa Ghilarducci, a labor economist at the New School in New York City. She cited the decline of traditional pensions and 401(k) balances that are nonexistent or too small to matter.

“We have been building toward this retirement crisis for decades,” Ghilarducci said. The falling overall poverty rate offers little relief to millions of older Americans facing inadequate savings, limited retirement plan access, and living costs that continue to test already thin resources.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.