Having a Hard Old Time

By Martha M. Hamilton
Sunday, December 24, 2006

Barbara E. Davis was 57 when the heart attack struck at midnight in April 1996. She had just turned over to look at the clock, and as she turned back, "the pain hit me between my breasts and went all the way through to my back."

Until that day, Davis had worked as a chef at the College of Preachers at the Washington National Cathedral, but the heart attack and subsequent open-heart surgery made it hard to continue at the job she had held since 1972, although she tried briefly. As a result, she retired sooner than expected -- before she was eligible for a full pension, she said.

Now she gets along on a little less than $15,000 a year in retirement -- her combined net income from Social Security and a pension benefit of $216.02 a month.

She is more typical than it often seems when you live in the world of the worried well -- those of us with the luxury of wondering whether to open a Roth or a traditional individual retirement account or whether to annuitize that lump sum. Nearly a quarter of all retirees have no income other than Social Security. For 40 percent of elderly recipients, Social Security is more than 90 percent of their income -- which underscores why strengthening Social Security is so important.

Davis raised her grandson and put him through Beauvoir, Annunciation and Georgetown Prep with the help of grants and other assistance. That used up any discretionary income she might have saved for retirement.

"I didn't have anything saved," said Davis. "But I don't regret it one bit, because he was such a good child, especially for a boy child." Two years ago, she watched him graduate from Indiana University, traveling by plane for the ceremony despite her fear of flying. Shortly after she returned, she suffered another heart attack.

Now she lives in subsidized senior housing operated by Asbury United Methodist Church. But she still has bills to pay and in recent weeks she has been struggling to pay for the numerous medications she takes, some of which are expensive. The new prescription benefit through Medicare made her drugs affordable until she hit the limit that requires patients to pay full price after total individual and government expenditures exceed $2,250.

Statistically you are more likely to end up poor or nearly poor if you are a woman or if you are black or Hispanic. It's hard to imagine you might end up in that category when you are working, but it can happen, especially if you get hit by something unexpected -- a heart attack, a layoff, the need to quit work to take care of an aging parent or an ailing spouse. Suddenly, instead of adding to savings, you're using them up -- long before anticipated.

When you're on a limited income, as Davis is, an increase in costs for prescriptions or anything else can throw you for a loop. "I have been putting medicines on my credit cards, and I've been saying, I've got to stop that because I'm putting myself further in the hole," she said. Emmaus Services for the Aging is helping her to find alternatives and recently lined up three months' worth of pharmaceutical company samples to cover one of her medications until the first of the year, when she will be eligible again for discounted medications.

Emmaus, which serves about 850 older residents of Washington, was founded in 1978 by Arthur S. Fleming, secretary of health, education and welfare in the Eisenhower administration and a force in shaping Social Security policy for more than four decades. He was also a member of the U.S. Commission on Aging during the Nixon administration. He brought together the five Washington churches behind that helped create the program -- Foundry United Methodist, Luther Place Memorial, First Baptist Church of Washington, Metropolitan AME and National City Christian, said Mauri S. Carter, development director.

"He said, 'There are a lot of senior citizens in poverty, living alone,' and he believed a community approach was the best way to care for seniors," she said. With a small staff but a large number of volunteers, Emmaus works by visiting clients at home and providing services at a center opened a few years ago.

"It's a community that often suffers in silence," said Carter. Clients may not have friends or family nearby who can check on them to make sure they are getting what they need. "If seniors are lonely, we visit them. If they're hungry, we feed them, and everything in between."

Poverty rates among the elderly have fallen over past decades, thanks largely to increases in Social Security benefits, according to the Congressional Research Service. In 1959, the poverty rate for those age 65 and older was 35 percent. Today, it's closer to 10 percent. But the CRS also points out that many older Americans "have family incomes that put them just above the official poverty threshold." Nearly a quarter of older Americans had family incomes that were below $14,050 for an individual and $17,722 for a couple.

So, as you contemplate the year-end fixes you can make to reduce your taxes and boost your retirement savings, take time to think about those who should be so lucky. Contribute something toward helping them. After all, you can write it off.

Are you struggling over whether you should save for retirement or for your children's college education? If so, and you're willing to talk about it on the record, I'd like to hear from you. Please e-mail hamiltonm@washpost.com.

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