You may have heard people mention the “Silver Tsunami” that is coming. The silver tsunami is a metaphor used to describe an expected boom in the senior population. Experts predict that by 2050, approximately 20% of the United States population will be 65 or older, compared to only 15% today. As the percentage of older adults increases, the percentage of working adults will decrease, presenting significant challenges.
Consult With A Southeastern Massachusetts Estate Planning Lawyer Today
At Surprenant & Beneski, PC, our experienced estate planning lawyers can help you prepare for retirement and protect your assets. We have an in-depth understanding of how the silver tsunami will affect retirees in Southeastern Massachusetts, and we can help you protect yourself. Contact us today to schedule your initial consultation.
What Is the Silver Tsunami?
As baby boomers reach their retirement years and people continue to live longer, we will experience a surge in the senior population. This silver tsunami will have a lasting impact on seniors across the country. In 2019, seniors age 65 and older were approximately 16.5% of the American population. The percentage of seniors is expected to reach 22% by 2050. Experts are concerned that we do not have the infrastructure to cope with a higher percentage of seniors who may need medical care and long-term care.
By 2050, there will be an additional 40 million people relying on the Medicare system, seeking senior living, and using the health care system. People have used the metaphor silver tsunami because it implies that a massive wave will have a devastating effect on the victims with which it collides. When an unprecedented number of seniors reach older age, we could experience a disastrous impact on our health care system and public benefits programs, making estate plans even more important.
The Silver Tsunami and Senior Living
As the percentage of retired Americans increases, so will the demand for senior living. We expect to see new senior living centers develop. We also hope that the style of senior living and senior care will change for the better. Baby boomers expect to enjoy their retirement and do not want to feel like patients in a nursing home.
As a result, many senior communities have innovated and provided their residents with greater amenities and choices. We’ve seen baby boomers revolutionize the senior living facility industry, and their expectations will continue to change what the aging process will entail.
On the other hand, the increase in demand for senior living facilities could result in a scarcity of adequate living facilities. Many seniors will need to live in an assisted living facility or retirement home at some point in their lives. Unfortunately, most private insurance plans do not cover long-term care stays. Medicare will not cover long-term care stays in nursing homes either. Your best option is to qualify for Medicaid, but doing so involves advanced planning because only applicants with limited assets qualify.
Most of us would like to stay at home as long as we can. However, developing a plan to pay for assisted living is important. Our law firm can help you develop an effective long-term care plan so you can live in an assisted living facility without depleting all of your hard-earned assets to pay for it. The sooner you begin planning for the possibility of long-term care, the better.
The Great Wealth Transfer
Americans will experience a great transfer of wealth over the next 20 years. Experts expect Baby Boomers to transfer over $30 trillion of wealth to younger generations who are their beneficiaries and heirs. Financial experts are referring to this unprecedented transfer as the “great wealth transfer.” As of 2015, Baby Boomers controlled roughly 70 percent of all disposable income. When this large amount of money transfers to the next generation, the implications will be vast.
What will this massive wealth transfer mean for the economy? We could see more of the younger generations moving back to the suburbs out of cities when they inherit property. Much of the wealth transferred to younger generations could be spent on medical bills, health services, daily expenses, and leisure activities. Financial experts recommend that people inheriting money from their grandparents or parents use it widely and consider their new investment and career opportunities.
The Silver Tsunami Will Affect Housing Prices
Seniors over age 60 own approximately one out of every three homes in the United States. Many seniors will decide to sell their homes during the silver tsunami and move to a retirement community or downsize into a smaller home. This transition will have a significant impact on the housing market. Between 2007 and 2017, approximately 730,000 senior-owned homes went up for sale. That number could increase as high as 1.17 million homes per year in the 2030s.
The real estate application Zillow anticipates that around 20 million properties will be listed for sale due to baby boomers downsizing or moving to assisted living, or passing away. If most of your retirement security is the equity in your home, it’s wise to keep the silver tsunami in mind when you plan for retirement. When the market becomes flooded with more properties, the value of your home may decrease. We recommend discussing this scenario with one of our skilled elder law attorneys.
Contact a Southeastern Massachusetts Estate Planning Lawyer
The silver tsunami will present multiple challenges for seniors and working-age adults alike. Understanding how you will be affected by the silver tsunami will help you plan to live comfortably. At Surprenant & Beneski, PC, we can help you develop an effective estate plan that will help you cover the increased medical costs you will incur after retirement.
Many difficulties that retirees face stem from a lack of proper estate planning. Our experienced elder law and estate planning lawyers will help you use all of the legal tools available to you so you can approach your retirement years with assurance. Contact us today to schedule your initial consultation to learn how we can help you prepare for the future.