Social Security is supposed to help America’s seniors, yet the monthly benefits are so low that many are poor.
The Social Security Administration assessed the average retirement payment at $1,565, which will rise to $1,657 in January due to a high COLA. That implies many of the nation’s elders earned less than $19,000 in a single year. According to a GoBankingRates analysis, the annual living wage in Florida is $63,645, creating a significant gap for seniors living on Social Security.
As a result, many seniors are financially strapped. According to the Congressional Research Service, 8.9% of seniors lived in poverty in 2019.
Many services like GAD $255 loans exist to assist elders with medication, food, and energy. They may not be enough to bridge the financial gap, but they can help struggling seniors.
Seniors Can Get Low-Income Home Energy Assistance (LIHEAP)
Energy prices can quickly overwhelm low-income homes. According to the Energy Information Administration, households spent $117 per month on energy in 2020. Costs vary by state; Connecticut residents paid $162 per month, while DC residents paid $89 per month.
The Low Income Home Energy Assistance Program (LIHEAP) is a federal program run by HHS. It assists low-income families with home energy bills, such as heating and cooling (but no water or sewer bills).
Households receiving other benefits, such as SSI, may be automatically eligible.
But LIHEAP isn’t meant to cover all of your energy bills, and it probably won’t. Since each state receives funds for the LIHEAP program, eligibility conditions vary. The amount of help a household is eligible for is determined by its location, income, energy demands, and family size.
Depending on your state, you may need to phone or make an appointment at an agency. Use this LIHEAP map to discover your state’s website for details on eligibility and application.
Senior Tax Credits and Deductions
When it comes to paying taxes, seniors can save money in several ways, including:
- Elderly or disabled credit: This tax credit helps reduce a taxpayer’s overall tax burden. The credit is available to anyone 65 or older by the end of 2021 and has taxable disability income. The distinction is worth $3,750 to $7,500. The filer must have an AGI or nontaxable Social Security, pension, annuity, or disability income equivalent to certain levels to qualify for the credit. Single filers, for example, cannot have AGI over $17,500 or nontaxable income over $5,000. For further information, see IRS Publication 524. To claim the credit, use Form 1040.
- Standard Senior Deduction: Most taxpayers take the standard deduction, decreasing taxable income without itemizing deductions. Seniors 65 and over at the end of the tax year get a more significant standard deduction. The standard deduction for single seniors in 2021 is $14,250.
- Medical Expenses: Seniors with high medical expenses should itemize rather than take the standard deduction. These include insurance premiums, Medicare payments, and long-term care insurance premiums.
How Seniors Can Apply for Food Stamps
Elderly hunger is real. According to Feeding America, one in 14 seniors aged 60 and older went hungry in 2019. The epidemic compounded the problem. Many people eligible for nutrition assistance do not receive it, either because they are unaware of their eligibility or are afraid of being judged for seeking help.
Among the many food aid programs are:
SNAP (Supplemental Nutrition Assistance Program) – SNAP subsidies help millions of Americans afford food. The USDA estimates that 42 million Americans will get SNAP benefits in 2021. But many eligible seniors go without. The average monthly benefit is now $157, the most significant increase in the program’s history. To qualify for SNAP, people over the age of 60 or handicapped must subtract medical expenses totaling $35 or more per month from their total income. SNAP for Seniors: How to Apply?
The Emergency Food Assistance Program (TEFAP) – TEFAP delivers USDA food directly to local organizations that serve the public, such as soup kitchens. The food is based on regional availability and includes fresh fruits and vegetables. Each state has different eligibility requirements. Contact your state distribution agency for details.
Seniors Farmer Market Nutrition Program- The USDA’s Senior Farmer Market Nutrition Program gives seniors access to locally farmed fruits, vegetables, and herbs. Applicants must be at least 60 years and have a household income of less than 185 percent of the federal poverty level. Senior centers and housing are common pick-up destinations. Learn more about the program and apply.
Meals on Wheels — This national group distributes daily meals to the elderly (typically 60+). The meal rates vary depending on the conditions, ranging from free to total price. Each program has eligibility requirements, such as a food evaluation or a medical or social worker recommendation. Through daily inspections, the program promotes elder freedom and dignity.
Help with Senior Health Care Costs
Health care bills can be a significant financial burden for seniors. Even with Medicare, a retired couple aged 65 in 2021 would require $300,000 in savings, according to Fidelity.
Among the Medicare programs that can help cover medical costs are:
Extra Help Program
This program helps people earn up to $19,320 annually ($26,130 for a married couple) and have up to $14,790 in assets such as cash, stocks, or bonds to afford prescription medicines ($29,520 for a married couple). The Extra Help Program caps generic drug expenses at $3.70 and brand-name drug costs at $9.20. Learn more about Extra Help and how to apply.
Medicare Savings Program
Program for those who cannot afford their Medicare premiums on their own. There are four Medicare savings schemes, each with monthly income restrictions and benefits. Discover the Medicare Savings Program and apply.
Are Seniors Being Forgotten?
Older readers have written to Forbes Advisor expressing dissatisfaction with the federal government’s financial help and resource allocation. While Social Security’s cost of living raise for 2022 is high (5.9% vs. 1.3%), the extra cash will barely keep up with inflation.
This apathy has lasted through successive governments.
Former President Trump failed to reduce medical costs. Former President Barack Obama did not fulfill other pledges, such as addressing future Social Security benefit cuts or expanding long-term care coverage.
President Joe Biden ran on cutting prescription drug costs, increasing Social Security payouts, and helping older employees to remain in the workforce. But, thus far, these issues have been overshadowed by Biden’s other objectives.
Democrats are presently debating Biden’s Build Back Better plan, which includes little protections for seniors. To decrease prescription medicine prices, a measure failed to pass a Democratic committee, jeopardizing its future adoption.
Various programs exist to assist financially strapped elders. However, they do not cover all desired. Will Congress strengthen financial assistance programs for seniors?