17 ms·

Seniors and the generation spending gap

62 points by kareemm 12y ago

transfire 12y ago
Don't worry, they'll get it all straightened out and start giving more to young than the old when I finally become a senior.
t1m 12y ago
The article is about well off seniors in Canada. I wonder if the situation is much different in the US. The health care system is certainly different. One gets the impression the system in the US preys on seniors as employer benefits evaporate after retirement while insurance premiums skyrocket or are denied because of 'pre-existing conditions'.
- michaelochurch 12y ago
  Medicare becomes available at 65. It gets a bad rap, but it's actually better than the vast majority of private insurance policies. Still, your observation is accurate and poignant. The whole purpose of private health insurance is to rob those who are easiest to rob (the old and sick). The problem is that old, sick people tend not to have a lot of money. So, the "genius" behind U.S.-style health insurance is that you can take money from people when young and well (and relatively wealthy) and then fail to deliver the promised services (on bullshit technicalities like "exclusions" and "pre-existing conditions" and "fuck you, you won't sue me because ha ha you have cancer and will be dead before trial date") in their hour of need, when they are too exhausted to fight back. If U.S.-style medical billing and insurance were pulled on anyone but the sick they would be met with Joe Stack levels of violence on a daily basis.
  - ericd 12y ago
    Anecdotal, but my doctor agrees wrt medicare - medicare is actually nicer to deal with than any of the big private guys, and actually pays claims without requiring hassling. She says that medicaid is a disaster to deal with, though (I think that one is state-run).
- bsdshepherd 12y ago
  This piece is inflammatory click bait using generational warfare rhetoric, pervasive in social media. Things are completely different in the US. Other speculations about the aged here are age independent. To approach the actual problem, you must first replace the word retirement with injury or downsize. In the U.S. healthcare is a tool for culling. Oh, look - Apple has new products...
michaelochurch 12y ago
First of all, when I'm old please don't call me a "senior". Call me "old". There's no shame in it, and nothing wrong with the word. From the OP: Why are we doing so much to try to help seniors when they’re already the wealthiest generation in history? At least in the U.S., it's because they're politically active. They vote. They mobilize. They demand services, for the tax dollars they've paid when young and that they are paying now. Invert the question: why don't young people demand much of their government? Why do we seem to be content with a system (and this goes beyond government, into the workplace) that costs so much and delivers so little? Why are we OK with high housing costs and stagnant wages? Why don't we demand the government to step in on airlines' sleazy dynamic pricing games, where a person using a different device to book the same flight at the same time pays a different fare? How come, when we're paying tax rates well over 30%, we don't have universal healthcare, and even if we're insured we still get crappy medical care and coverage? Why do we tolerate that? Why haven't we unionized or formed professional associations in software? Here's the answer. The critical difference between young and old is that the old people know their financial situations aren't going to dramatically improve. An old person of average financial outcome has no delusions that he'll be a tech billionaire in 3 years if he can just save up for his move to the Valley. Young people haven't figured that out yet, and still believe that they can beat the astronomical odds against them, and therefore tend reflexively to identify with the rich. The plight of the young can be ignored because the young haven't figured out yet how badly most of them are going to lose, and that political activism (again, perhaps in the form of workplace collective bargaining instead of electoral canvassing) is essential to keeping them afloat.
- k__ 12y ago
  Also, they are simply "more"... At least here in Germany.
- a3n 12y ago
  It doesn't matter what they call you, you'll be dismissed as irrelevant and incapable.
- morgante 12y ago
  Spot on. Thanks to Lake Wobegon syndrome, American youth inevitably think they'll end up on the rich side. By the time they're seniors, the veil of ignorance that fades. Reminds me of the quote from John Steinbeck that Americans are never poor, they're just temporarily inconvenienced millionaires. I guess that by the time you're 60 you realize that those millions are never coming.
cldellow 12y ago
My favourite bugbear: deferred property tax for seniors. I've always thought that age was a fascinating element in these programs. Why not just have programs for low-income people, full stop -- why make it low-income seniors? And then the logical followup: how are you financially vulnerable if you have an asset worth hundreds of thousands of dollars? Some jurisdictions in Canada do these programs better than others. My hometown of Kitchener, Ontario requires that you be receiving the federal guaranteed income suppement (given to all retired folk below a certain income threshold) before they let you defer your property taxes. The province of British Columbia will defer property taxes for anyone over age 55. If I lived in BC, I would certainly choose to defer property tax, with interest assessed at 1%/year, and invest the deferred tax in the market. In fact, I might invest the difference in BC bonds -- which pay 3.4%/year. What a sham for the taxpayer.
- cauterized 12y ago
  They do this because seniors are typically on a fixed retirement income and often aren't even capable of working to increase it (which is why social security exists in the first place). They are financially vulnerable if they own a home but the taxes on it exceed what they can afford on that fixed income, which can easily happen when property values increase, when property taxes increase, or when inflation makes the fixed income cover less of their other expenses. The deferred taxes make sense because the seniors can then stay in their home instead of uprooting their lives and possibly spending even more on rent, and the govt gets their taxes eventually anyway.
  - cldellow 12y ago
    Most seniors are on a fixed income -- the ones on GIS, certainly. It's not clear to me why anyone over age 55 should be eligible, when the retirement age in Canada is 67. The government is effectively paying them to live in their house, no? They're charging 1% interest but raising money in the bond market at 3.4%. Presumably if they were actually collecting the property tax, they would have less of a shortfall to cover in the bond market.
    - 12y ago
rcarrigan87 12y ago
Does anyone have US numbers for the stats cited in this article? Side note: while this article paints seniors as maybe getting more than they deserve, financial elder abuse is a huge problem already in the US. Articles like this worry me because some may twist the points to justify stealing. Rich or not, it's very easy to take advantage of the elderly. I've seen family members, caregivers, family lawyers, etc. do terrible things for money. It's sad.
- KrisAndrew 12y ago
  Just a guess, but it's probably a similar situation in the US when the same cohort is compared to their ancestors. My mom (66 years old) is certainly way better off than her mother was at 66+. My friends' parents seem to be similarly comfortable in their golden years. Post-WWII largesse really paid off for them, but who's really going to pay for it?
jrapdx3 12y ago
There is huge liability in living to be old. Sure, work hard, save money for old age, and get old, there's a stash of funds. But even a million bucks has got to last the rest of your life, and who knows, my aunt is 100 years old, and still going. Retire at, let's say 70, and figure it out, will that stash last up to 30 years? Do the math, taking out taxes at 25%, that's $25000/year. With social security, around $4000/month, just an estimate. How wealthy is that? Is it really even adequate? Consider what happens with age: people get sick, bodies deteriorate, it's natural. Go to the ER, have an MRI, a hospital stay, whatever, it can be thousands out of pocket, even with medicare + insurance. With serious illness, that million bucks can go fast. And even if there is good health care to be found, which is dubious, it's still scary and a constantly threatening reality. Don't forget the house payments, computer gear and all the other normal stuff one needs to buy. If the house is paid up, chances are it's an old house and will need repair. Price out what a new roof or furnace costs (I've had to replace both in the last couple of years). OK I'm old but I still go to work, though I can't do that forever. Call it what you will, I have a wealth of experience, accomplishment, family and great friends, but not a princely cache of money. Many old citizens are in a far more precarious position as financial security goes. I hope no one thinks it's a trivial concern.
- Dylan16807 12y ago
  So fix the insurance system to not be capable of wiping out a million dollars in savings. As far as housing, I'm not super sympathetic about having to move somewhere cheaper as the downside to spending an entire third of your life retired.
- djokkataja 12y ago
  Many young people have negative net worth because they keep taking out student loans hoping to get a job. Your scenario about the costs and difficulties of maintaining a house won't generate any sympathy with young people. There are zero people that I know from my graduating class (2009) who have purchased a house since college. If you're seriously concerned about having saved enough to retire by the time you reach retirement age, maybe you should keep working. My parents have planned to push their retirement back about a decade for that reason.
fra 12y ago
The more I read about this, the more I think that what we're facing in North America isn't class war, it's "generation" war. By "Limited Government" the baby-boomers backed republican party means "screw schools & food stamps, but hands off my medicare!".
- bequanna 12y ago
  Well, some might argue that even the liberal agenda in the US heavily favors the boomers (at the expense of our youth). -As a 'millennial' I am now legally required to subsidize health care for boomers -The Federal Gov't recently raised rates on already massively profitable student loans, yet has no problem losing Billions guaranteeing NINJA boomer loans for McMansions. -I live in what would be considered a fairly liberal area. However, the median age is above the US average. School funding referendums fail by a wide margin here. There are certainly exceptions, but, generally, I sense that boomers have little respect or regard for our generation (millennials).
  - vacri 12y ago
    Don't worry, when you're 50, you'll have the political power to strip wealth from the young as well. It's nothing specific to boomers vs millenials, it's just the way of the world. Older people have political power, because they have a lifetime of networking, along with personal wealth accreted over that time. Or, in simpler terms, when has there ever not been a "young people these days!" comment?
    - guard-of-terra 12y ago
      It may happen that there won't be much young to strip wealth from. Current generation gets their pensions, we'll get nothing.
Htsthbjig 12y ago
Wow!: “But they shouldn’t expect to be subsidized by the poor.” Something is very clear: politicians always want more, and more and more. They never have enough taxes. "Thanks to stock market booms, economic growth, a soaring real estate market and a major expansion in both private and government pension plans" I don't know Canada, but here in Europe pensions are shrinking, and stock market is a bubble that will pop when interest types rise, and they will soon(they are unsustainable now). I am young and the only thing I need is freedom, economic freedom included, let bubbles burst so we could acquire our houses and cars at the right price. They let it only go up, then they try to sustain it artificially injecting public money in banks and making "bad banks"also public. Politicians and taxes are the problem, not the solution.
- deleted 12y ago
  [deleted]

62 points by kareemm 12y ago

Don't worry, they'll get it all straightened out and start giving more to young than the old when I finally become a senior.

t1m 12y ago

The article is about well off seniors in Canada. I wonder if the situation is much different in the US. The health care system is certainly different. One gets the impression the system in the US preys on seniors as employer benefits evaporate after retirement while insurance premiums skyrocket or are denied because of 'pre-existing conditions'.

michaelochurch 12y ago
Medicare becomes available at 65. It gets a bad rap, but it's actually better than the vast majority of private insurance policies. Still, your observation is accurate and poignant. The whole purpose of private health insurance is to rob those who are easiest to rob (the old and sick). The problem is that old, sick people tend not to have a lot of money. So, the "genius" behind U.S.-style health insurance is that you can take money from people when young and well (and relatively wealthy) and then fail to deliver the promised services (on bullshit technicalities like "exclusions" and "pre-existing conditions" and "fuck you, you won't sue me because ha ha you have cancer and will be dead before trial date") in their hour of need, when they are too exhausted to fight back. If U.S.-style medical billing and insurance were pulled on anyone but the sick they would be met with Joe Stack levels of violence on a daily basis.
- ericd 12y ago
  Anecdotal, but my doctor agrees wrt medicare - medicare is actually nicer to deal with than any of the big private guys, and actually pays claims without requiring hassling. She says that medicaid is a disaster to deal with, though (I think that one is state-run).
bsdshepherd 12y ago
This piece is inflammatory click bait using generational warfare rhetoric, pervasive in social media. Things are completely different in the US. Other speculations about the aged here are age independent. To approach the actual problem, you must first replace the word retirement with injury or downsize. In the U.S. healthcare is a tool for culling. Oh, look - Apple has new products...

michaelochurch 12y ago

First of all, when I'm old please don't call me a "senior". Call me "old". There's no shame in it, and nothing wrong with the word. From the OP: Why are we doing so much to try to help seniors when they’re already the wealthiest generation in history? At least in the U.S., it's because they're politically active. They vote. They mobilize. They demand services, for the tax dollars they've paid when young and that they are paying now. Invert the question: why don't young people demand much of their government? Why do we seem to be content with a system (and this goes beyond government, into the workplace) that costs so much and delivers so little? Why are we OK with high housing costs and stagnant wages? Why don't we demand the government to step in on airlines' sleazy dynamic pricing games, where a person using a different device to book the same flight at the same time pays a different fare? How come, when we're paying tax rates well over 30%, we don't have universal healthcare, and even if we're insured we still get crappy medical care and coverage? Why do we tolerate that? Why haven't we unionized or formed professional associations in software? Here's the answer. The critical difference between young and old is that the old people know their financial situations aren't going to dramatically improve. An old person of average financial outcome has no delusions that he'll be a tech billionaire in 3 years if he can just save up for his move to the Valley. Young people haven't figured that out yet, and still believe that they can beat the astronomical odds against them, and therefore tend reflexively to identify with the rich. The plight of the young can be ignored because the young haven't figured out yet how badly most of them are going to lose, and that political activism (again, perhaps in the form of workplace collective bargaining instead of electoral canvassing) is essential to keeping them afloat.

k__ 12y ago
Also, they are simply "more"... At least here in Germany.
a3n 12y ago
It doesn't matter what they call you, you'll be dismissed as irrelevant and incapable.
morgante 12y ago
Spot on. Thanks to Lake Wobegon syndrome, American youth inevitably think they'll end up on the rich side. By the time they're seniors, the veil of ignorance that fades. Reminds me of the quote from John Steinbeck that Americans are never poor, they're just temporarily inconvenienced millionaires. I guess that by the time you're 60 you realize that those millions are never coming.

cldellow 12y ago

My favourite bugbear: deferred property tax for seniors. I've always thought that age was a fascinating element in these programs. Why not just have programs for low-income people, full stop -- why make it low-income seniors? And then the logical followup: how are you financially vulnerable if you have an asset worth hundreds of thousands of dollars? Some jurisdictions in Canada do these programs better than others. My hometown of Kitchener, Ontario requires that you be receiving the federal guaranteed income suppement (given to all retired folk below a certain income threshold) before they let you defer your property taxes. The province of British Columbia will defer property taxes for anyone over age 55. If I lived in BC, I would certainly choose to defer property tax, with interest assessed at 1%/year, and invest the deferred tax in the market. In fact, I might invest the difference in BC bonds -- which pay 3.4%/year. What a sham for the taxpayer.

cauterized 12y ago
They do this because seniors are typically on a fixed retirement income and often aren't even capable of working to increase it (which is why social security exists in the first place). They are financially vulnerable if they own a home but the taxes on it exceed what they can afford on that fixed income, which can easily happen when property values increase, when property taxes increase, or when inflation makes the fixed income cover less of their other expenses. The deferred taxes make sense because the seniors can then stay in their home instead of uprooting their lives and possibly spending even more on rent, and the govt gets their taxes eventually anyway.
- cldellow 12y ago
  Most seniors are on a fixed income -- the ones on GIS, certainly. It's not clear to me why anyone over age 55 should be eligible, when the retirement age in Canada is 67. The government is effectively paying them to live in their house, no? They're charging 1% interest but raising money in the bond market at 3.4%. Presumably if they were actually collecting the property tax, they would have less of a shortfall to cover in the bond market.
  - 12y ago

rcarrigan87 12y ago

Does anyone have US numbers for the stats cited in this article? Side note: while this article paints seniors as maybe getting more than they deserve, financial elder abuse is a huge problem already in the US. Articles like this worry me because some may twist the points to justify stealing. Rich or not, it's very easy to take advantage of the elderly. I've seen family members, caregivers, family lawyers, etc. do terrible things for money. It's sad.

KrisAndrew 12y ago
Just a guess, but it's probably a similar situation in the US when the same cohort is compared to their ancestors. My mom (66 years old) is certainly way better off than her mother was at 66+. My friends' parents seem to be similarly comfortable in their golden years. Post-WWII largesse really paid off for them, but who's really going to pay for it?

jrapdx3 12y ago

There is huge liability in living to be old. Sure, work hard, save money for old age, and get old, there's a stash of funds. But even a million bucks has got to last the rest of your life, and who knows, my aunt is 100 years old, and still going. Retire at, let's say 70, and figure it out, will that stash last up to 30 years? Do the math, taking out taxes at 25%, that's $25000/year. With social security, around $4000/month, just an estimate. How wealthy is that? Is it really even adequate? Consider what happens with age: people get sick, bodies deteriorate, it's natural. Go to the ER, have an MRI, a hospital stay, whatever, it can be thousands out of pocket, even with medicare + insurance. With serious illness, that million bucks can go fast. And even if there is good health care to be found, which is dubious, it's still scary and a constantly threatening reality. Don't forget the house payments, computer gear and all the other normal stuff one needs to buy. If the house is paid up, chances are it's an old house and will need repair. Price out what a new roof or furnace costs (I've had to replace both in the last couple of years). OK I'm old but I still go to work, though I can't do that forever. Call it what you will, I have a wealth of experience, accomplishment, family and great friends, but not a princely cache of money. Many old citizens are in a far more precarious position as financial security goes. I hope no one thinks it's a trivial concern.

Dylan16807 12y ago
So fix the insurance system to not be capable of wiping out a million dollars in savings. As far as housing, I'm not super sympathetic about having to move somewhere cheaper as the downside to spending an entire third of your life retired.
djokkataja 12y ago
Many young people have negative net worth because they keep taking out student loans hoping to get a job. Your scenario about the costs and difficulties of maintaining a house won't generate any sympathy with young people. There are zero people that I know from my graduating class (2009) who have purchased a house since college. If you're seriously concerned about having saved enough to retire by the time you reach retirement age, maybe you should keep working. My parents have planned to push their retirement back about a decade for that reason.

fra 12y ago

The more I read about this, the more I think that what we're facing in North America isn't class war, it's "generation" war. By "Limited Government" the baby-boomers backed republican party means "screw schools & food stamps, but hands off my medicare!".

bequanna 12y ago
Well, some might argue that even the liberal agenda in the US heavily favors the boomers (at the expense of our youth). -As a 'millennial' I am now legally required to subsidize health care for boomers -The Federal Gov't recently raised rates on already massively profitable student loans, yet has no problem losing Billions guaranteeing NINJA boomer loans for McMansions. -I live in what would be considered a fairly liberal area. However, the median age is above the US average. School funding referendums fail by a wide margin here. There are certainly exceptions, but, generally, I sense that boomers have little respect or regard for our generation (millennials).
- vacri 12y ago
  Don't worry, when you're 50, you'll have the political power to strip wealth from the young as well. It's nothing specific to boomers vs millenials, it's just the way of the world. Older people have political power, because they have a lifetime of networking, along with personal wealth accreted over that time. Or, in simpler terms, when has there ever not been a "young people these days!" comment?
  - guard-of-terra 12y ago
    It may happen that there won't be much young to strip wealth from. Current generation gets their pensions, we'll get nothing.

Htsthbjig 12y ago

Wow!: “But they shouldn’t expect to be subsidized by the poor.” Something is very clear: politicians always want more, and more and more. They never have enough taxes. "Thanks to stock market booms, economic growth, a soaring real estate market and a major expansion in both private and government pension plans" I don't know Canada, but here in Europe pensions are shrinking, and stock market is a bubble that will pop when interest types rise, and they will soon(they are unsustainable now). I am young and the only thing I need is freedom, economic freedom included, let bubbles burst so we could acquire our houses and cars at the right price. They let it only go up, then they try to sustain it artificially injecting public money in banks and making "bad banks"also public. Politicians and taxes are the problem, not the solution.

deleted 12y ago
[deleted]