Older Boomers Have a Lot of Home Equity

It looks like most older boomers have a lot of wealth stored in their homes and are mortgage-free. Now, these home owners are looking for ways to tap that wealth and use it for aging in place. I've pasted the entire article below.

The research was publish by the Center for Media Research. I found it fascinating and so different from what I'm reading about the younger generations.

Here is a link to the MetLife Mature Market study:

Boomers Leveraging Home Equity For Retirementuesday, June 30, 2009

Boomers Leveraging Home Equity For Retirement

The Study on the Changing Role of Home Equity and Reverse Mortgages, by the MetLife Mature Market Institute, finds that growing numbers of older homeowners are starting to tap their housing wealth, using home-equity loans or reverse mortgages. However, they are often unsure about how to include this asset as an integral part of their financial strategy, rather than as a last resort.

Mortgage Status Among Homeowner Households Age 62 and Older


% of Homeowner HH

Regular mortgage


Regular mortgage plus home equity loan


Home equity loan only


Reverse mortgage


No home loan


Source: American Housing Survey, 2007

Sandra Timmermann, Ed.D, director of the MetLife Mature Market Institute, said "... Retirees need a new framework for thinking about how home equity can help assure their financial security and enable them to age in place without fear of running out of money."

The study finds that 35% of older Americans see their homes not just as places to live, but also as collateral for a loan. 14% are taking cash out of their house through a home equity loan or reverse mortgage. Older homeowners are using home equity to increase income security, enhance financial resilience to deal with unexpected expenses, and to improve debt management, among other things

This is a growing reality for affluent households who seek to enhance their lifestyle, as well as middle-income families for whom it may be their only choice.

Attributes of Homeowner Households Age 62 and Older, by Wealth Status


Middle Income


House-rich and cash-rich

House-rich or cash-rich

Moderate wealth

House-rich and cash-poor

House-poor and cash-poor

Median Household Values

Age of householder






Home value






Household income






Other Household Demographics







Has a college education






Householder worked last week






No mortgage







Homeowner households age 62+






% of total households (21.75 million)






Source: National Council on Aging (NCOA) calculations based on data from the American Housing Survey, 2007.

The study highlights different options for using home equity that are not part of the current national conversation. These include:

  • The use of reverse mortgages to delay the age at which one might begin to collect Social Security, thus increasing the amount of one's ultimate monthly Social Security income
  • Reverse mortgages as a stopgap measure to consolidate credit card debt, to cover investment losses or to defer mortgage payments
  • Periodic distributions that would tap home equity to help people meet expenses if they outlive their savings/retirement income
  • Programs that combine public benefits with modest amounts drawn from home equity to help seniors stay at home
  • Home equity lines of credit for emergency spending, such as home maintenance, without which many homes decay and lose value
  • Reverse mortgages with a line of credit option for borrowers to pay out-of-pocket health and home care expenses.

"With the right guidance and policy protection, reverse mortgages can be an important financial option for Boomers who do not have adequate savings." said Timmermann. The report emphasizes that consumer education must be part of any new efforts aimed at increasing the use of reverse mortgages.

The full study, Tapping Home Equity in Retirement: The MetLife Study on the Changing Role of Home Equity and Reverse Mortgages, and The Essentials: Reverse Mortgages, are available here under "What's New."

We welcome and appreciate forwarding of our newsletters in their entirety or in part with proper attribution.
(c) 2009 MediaPost Communications, 1140 Broadway, 4th Floor, New York, NY 10001

Sustainable Housing for the Aging

I'm reading a fabulous study from Harvard University on sustainable housing for the aging - http://www.ecological-engineering.com/aging-in-place.pdf.

The statistics are staggering and enlightening. They clearly show that we need to understand more about the costs and benefits of the different ways we can live as we age:

According to American Association of Homes for the Aging (AAHA), the statics are as follows:
Need for long-term care
• Among people turning 65 today, 69 percent will need some form of long-term
care, whether in the community or in a residential care facility.
• By 2020, 12 million older Americans will need long-term health care
Availability of elder care housing
• There are 16,100 certified nursing homes in the United States.
• There are 39,500 assisted living facilities in the United States.
• There are 1,900 continuing care retirement communities in the United States.
• There are more than 300,000 units of Section 202 affordable senior housing
available in the United States.
• For each Section 202 affordable senior housing unit that is available, there are ten
eligible seniors on waiting lists for it. The average time an eligible senior is on the
waiting list is 13.4 months.
Cost for elder housing
• The average daily cost for a private room in a nursing home is $213.00 or $77,745
• The average daily cost for a semi-private room in a nursing home is $189.00 or
$68,985 annually.
• The average monthly cost of living in an assisted living facility is $2,969 or
$35,628 annually.
• The average monthly cost of living in a not-for-profit Continuing Care Retirement
Community is $2,672 or $32,064 annually.
• The average monthly rate for assisted living facilities that charge additional fees
for Alzheimer’s and dementia care is $4,270 or $51,240 annually.
• To move into a community, individuals must also pay an entry fee ranging from
$60,000 to $120,000.
• The average hourly rate for a certified home health aide is $32.37.
• The average hourly rate for a uncertified home health aide is $19.00.
• The national average daily rate for adult day centers is $61.00 (2007 MetLife
Market Survey of Adult Day Services & Home Care Costs)
• The national average hourly rate for homemakers/companions is $18.00 (2007
MetLife Market Survey of Adult Day Services & Home Care Costs)
Who Pays?
• Nearly 40 percent of long-term care spending is paid for by private funds.
• Medicare, which covers rehabilitation services after an individual is discharged
from a hospital, pays for 19 percent of all long-term care spending.
• Medicaid, which covers health care costs for low-income individuals, pays for 49
percent of all long-term care spending.
• Accounting for about 40 percent of total expenditures on nursing facilities,
Medicaid's payments cover the care of more than half of all nursing home
Use of elder care housing
• There are more than 1.4 million nursing home residents in the United States.
• An individual's average age when he or she moves into a nursing home is 79.
• Women are almost three times as likely to live in nursing homes as men.
• More than 900,000 individuals live in assisted living residences.
• More than 150,000 individuals receive care and services at an adult day center.
• There are more than 1.1 million seniors in some type of senior housing
community in the United States.
• There are approximately 745,000 older adults who live in continuing care
retirement communities in the United States.
• The average age of an individual moving into a continuing care retirement
community is 78.
• Nearly 1.4 million individuals receive home health services.
• The average lifetime nursing home use per individual is one year, and the average
home care use is a little over 200 visits.
Disappearing Assets
As you can see, the equity in existing homes of the elderly can be quickly consumed and the
elders forced to go on welfare. What a terrible way to finish a wonderful life.

Knee Replacements Worth It in Elderly

As health care gets more and more complicated and expensive, this will be the way we have to start thinking of all our medical decisions. Read the article - introductory paragraph and link below.

A $20,000 procedure to replace a knee ravaged by arthritis in the elderly is generally a good deal for both patients and the federal Medicare program that pays the bill, according to a new study.


Continuing Care Vs. Aging in Place

My parents-in-law were determined not to be a burden, so they decided to move to a continuing care community. My aunt is determined to stay as far away as possible from a CCC, opting rather to live near one of her sons in her own home. Aging in Place has become an economic and lifestyle choice for many. The Wall Street Journal had a good essay on Continuing Care Communities in their Encore section on retirement this past weekend. The writer asks if moving is really such a good idea, given the costs.
Here is a link:



Beacon Hill Village Gets Expansion Grant

Beacon Hill Village, the organization in Boston that is riding the crest of the aging in place wave, has secured a replication grant from the Milbank Foundation. They did this because so many people across the country have asked for help in starting their own organizations based on the BHV model. Their press release is below.

VtV Network


Earlier we emailed you to ask for your ideas how a network of Villages could help you. We also asked you to express any interest you may have in joining this network.
We wanted to let you know that The Village to Village Network has recently received a $50,000 grant from the Milbank Foundation for Rehabilitation to expand the Village model nationwide. This grant will be used to build some of the services and delivery methods that communities have requested. Click here for Press Release.

This grant means that the VtV Network will become a reality soon.

We would like to be certain that we offer what you will need. So please go to our new website, www.vtvnetwork.org and read what we are planning; then give us your opinion and level of interest by completing the short questionnaire. Thank you if you have already submitted the survey!

The VtV Network is a collaboration between BHV and NCBCI.

Logo NCB Capital Impact

Scammers Prey on Elderly

A Wall Street Journal reporter wrote a terrific article on how hard it has been to stop scammers from scamming a beloved relative. More seniors and their family members need to be aware of this problem.

A Family's Fight to Save an Elder From Scammers

When the Patriarch Fell Prey to Thieves, Relatives Took Matters Into Their Own Hands


Walking to Stay Healthy

Want to stay healthy? What to stay out of a nursing home? Here is an organization in Santa Cruz, California, that helps people over 50 achieve those goals through walking, hiking and social games. It's called the Redwood Fitness Alliance.


They are affiliated with the Lifelong Fitness Alliance program, based on from research by the Prevention Research Center at the Stanford University School of Medicine.

Check it out.

I think I may try to start a program like this in Darien, CT, where I live.

SustiNet Bill Wins Legislative Approval in CT

I'm not sure how I feel about this legislation requiring insurance companies not to charge older people or sicker people more in premiums in Connecticut. NY has similar legislation, and it makes health insurance unaffordable for the young. I fear that we will lose insurance companies who currently write insurance in CT. Golden Rule won't write insurance in NY or MA because it can't discriminate in those states. Health insurance for a healthy young person is less than $90/month in CT, but it's close to $1,000 in NY. CT allows high deductible plans; NY doesn't. This legislation may prove to be very costly for many people.

Here is the article about Sustinet Legislation in Connecticut -- from AARP website:

SustiNet Bill Wins Legislative Approval!

Source: AARP.org

One of the highlights of Connecticut’s 2009 regular Legislative Session, which ended at midnight on June 3, was the passage of SustiNet (H.B. 6600), a comprehensive health reform bill, endorsed by AARP, that would provide quality, affordable coverage to all Connecticut residents who need it. The bill, which would be phased in over several years, promises to provide more than 98 percent of state residents with affordable, quality health coverage by 2014.

The legislation passed in the Connecticut House of Representatives on May 20, 2009 by a vote of 107 to 35 and, aided by the advocacy of AARP members and volunteers, it passed the Senate chamber on May 30, 2009 by a vote of 23 to 12. AARP, along with the bill’s creator, the Universal Health Care Foundation of Connecticut, and dozens of supporting organizations, are urging the Governor to sign this landmark legislation into law. Find out the current status of SustiNet and get the latest Journal News, updates, and information from AARP Connecticut at www.aarp.org/ct.

SustiNet includes a number of provisions that AARP believes are critical to comprehensive health reform, including: the assurance that rates will not be based on age, gender or health status; guaranteed coverage for those with chronic or pre-existing conditions; a comprehensive benefits package; subsidies to make coverage affordable for low-income individuals and families; and the preservation of choice for Connecticut consumers, by allowing those who are happy with their current private coverage to keep it.

AARP Connecticut State President Don Ciosek said, “These are the major building blocks of reform that, together with cost-saving measures such as increased use of Health Information Technology, an emphasis on wellness and prevention, and better coordinated care, will ensure Connecticut continues to be a national leader in the care of its most vulnerable and put our economy back on solid financial footing.”

According to AARP Connecticut State Director Brenda Kelley, “A tremendous amount of work, resources and commitment went into designing SustiNet and we now stand at the apex of a monumental opportunity to reform our health care system, lower costs and provide quality, affordable coverage for all Connecticut residents.”

To learn more about SustiNet, go to www.healthcare4every1.org or www.universalhealthct.org

If you are interested in volunteering with AARP as a legislative advocate, please send us an email at ctaarp@aarp.org or call us toll-free at 1-866-295-7279.

Vetting Service Providers

When we were conducting focus groups among older people in Darien, CT, almost all of our participants said they needed handyman or other services. The respondents said that it was really difficult to find reliable contractors and wished there were a source of trustworthy people. That way, they'd feel more comfortable letting these workers onto their property and into their homes.

That's why virtually all Aging in Place organizations like Aging in Place in Darien and ones following the Beacon Hill Village model provide members with referrals from their list of vetted service providers. I was recently following an online group discussion among the organizations from all over the country as to what they do to vet their service providers. I loved the discussion because it showed that each group was reaching out to others to learn what the best practices are.

The vetting process seems to be quite thorough. The village-model and other senior-serving groups look for referrals from other members or board members, licenses, bonding, insurance and business history. They have standard forms for the businesses to fill out. In some instances, they check criminal backgrounds and driving records. Then, when a member calls for a contractor, most groups give out several names and are careful to tell people to do their own due diligence, such as checking references. The village-model organizations can't really be responsible for the acts of these independent contractors. All they can do is check the basics. But that's a lot more than what older people can get by looking in the Yellow Pages or searching online. (Yes, some older people do go online. I have three friends over 80 who use the Internet regularly.)

When seniors join the village-model or other aging in place groups, they gain a sort of peace of mind. Being able to have access to a source of vetted service providers adds to that peace.

NY Times Blog on Aging

I just found a great new blog on aging in the online New York Times. It's called "new old age".

"About The New Old Age

Thanks to the marvels of medical science, our parents are living longer than ever before. Adults over age 80 are the fastest growing segment of the population, and most will spend years dependent on others for the most basic needs. That burden falls to their baby boomer children, 77 million strong, who are flummoxed by the technicalities of eldercare, turned upside down by the changed architecture of their families, struggling to balance work and caregiving, and depleting their own retirement savings in the process. In The New Old Age, we explore this unprecedented intergenerational challenge.

While founding blogger Jane Gross is on leave, at work on a book, we'll be posting contributions from a variety of writers. You can reach the editors at newoldage@nytimes.com."

Check it out.


Aging in Place Initiative - Livable Communities

Wow! I was so surprised to find the Aging in Place Initiative. (Take a look -- http://www.aginginplaceinitiative.org/) What a great site that has information of all kinds for anyone who wants to know how to create livable communities for all ages -- keeping seniors in the community. Here are some important facts from their site:
Facts Print

Population Facts

  • By 2030, nearly one in five Americans—71.5 million people—will be over age 65.
  • Today, there are more than 35 million Americans age 65 or above—a tenfold increase in the 65 and over population since 1900. Over the next 25 years, that number will double, and one in every five Americans will be age 65 or older.
  • Contrary to popular belief, only a small minority move to warmer climates upon retirement. Fewer than 5 percent of the 65 and over population reside in nursing homes. Instead, most Americans choose to age in place, within the same communities where they have long lived.

Housing Facts

  • Homeownership rates among adults age 65 and above, at more than 80 percent, are higher than the national average.
  • One in every four renters age 50 and above pays 50 percent or more of annual income on rent.
  • The average annual cost per patient of nursing home care is more than $60,000.

Planning and Zoning Facts

  • Coming soon...

Transportation Facts

  • Only 3 percent of all trips taken by Americans age 65 and above are by bus or train.
  • 55 percent of Americans say they would prefer to walk more and drive less.
  • Individuals with health impairments or disabilities often have difficulty using fixed-route transit systems, because of factors such as poor pedestrian accessibility or the lack of accessible design features at buses and rail stations.
  • One in five Americans age 65 and above does not drive.

Health and Supportive Services Facts

  • One in five older Americans does not know who to call for information about local services in their community.
  • Low-income areas typically have one-third fewer grocery stores than middle and high-income neighborhoods.12
  • Older volunteers in one intergenerational program reported higher activity levels, increased strength, and a bigger support network.

Culture and Lifelong Learning Facts

  • During the next 25 years, the older Latino population will grow four-fold, from 2 million today to 8 million in 2030. The older Asian population will grow from 1 million to 4 million. In areas in states with high immigrant populations, such as Florida and Texas, the growth will be even more dramatic.
  • Older adults participating in weekly arts programs reported better health, fewer doctor visits, and less medication usage.
  • Only 1 in 3 older adults today has access to the Internet.

Public Safety Facts

  • More than one-third of older adults interviewed in a national survey identify crime as a problem in their neighborhoods.
  • In a national survey by the AdvantAge Initiative, 34 percent of older adults report crime as a problem in their neighborhoods. Crime is the top problem reported by African-American and Hispanic older adults.
  • It is estimated that 1 to 2 million Americans age 65 and above have suffered elder abuse; however, detecting and preventing elder abuse is inherently difficult. Many victims are isolated and do not know where to turn for redress. For every one case of elder abuse that is documented, approximately five cases go unreported.

Civic Engagement and Volunteer Opportunities Facts

  • Research has shown that older adults prefer working with children and youth more than any other volunteer activity.
  • Young people who participate in intergenerational programs show measurable improvements in school attendance and attitudes toward school.

New Network for Village Creators

Want to start your own "Village" to help people stay in their homes for life? Beacon Hill Village is making it easier through a new website built to help grassroots organizations like theirs. Here are a link to the website and their press release:


CONTACT: Charity Sack, (703) 647-2337

'Village' Movement Offers Aging Baby Boomers

Opportunity to Remain in Their Homes

BOSTON, MA (May 6, 2009) Millions of Americans wrestling with the challenge of aging with independence and remaining in their homes can now create their own “Villages” that will allow them to do just that. The Village to Village Network will be hosting the next Regional Workshop June 15th, 2009 in Denver, CO to provide critical information about this proven model and community-based approach.

The projected growth of the elderly population, which currently includes more than 37 million people age 65 or older in the U.S., highlights the need for more community-based alternatives. The recent economic downturn has impacted older Americans’ income and assets. Retirement savings losses are staggering – currently estimated at roughly $2 trillion. Many older Americans are considering more affordable alternatives to access long term services and supports with a preference to remain within their communities.

‘Villages’ are consumer-driven, non-profits that help people 50 and over stay in their own homes throughout their lives. There are currently 40 open villages and hundreds starting around the country. The Village-to-Village approach establishes membership-driven organizations run by small staffs and volunteers who coordinate affordable services including transportation, in-home medical care, home repairs and other day-to-day needs enabling individuals to receive care at home.

The workshop is designed for community leaders and professionals interested in creating and funding ‘Villages’ in their own communities. Topics to be covered are: How to start a ‘Village’, board development, marketing, strategic partners, providers, fundraising, budgets. Leaders from unique open ‘Villages’ around the country will discuss how they created their own ‘Villages’. Panelist will be leaders from: Capitol Hill Village (Washington DC), Washington Park Cares (Denver, Colorado), Front Desk Florence (Florence Oregon), and Beacon Hill Village (Boston, Massachusetts).

The Village to Village Network Regional Workshop will be June 15th, 2009 in Denver, Colorado from 9:00AM-4:00PM at the Hyatt Denver Convention Center. Registration is available at www.vtvnetwork.org.


About Village to Village Network
The Village to Village Network (VtV) is by Villages for Villages. The VtV Network helps communities establish and manage their own “Villages.” The Network is sponsored through a joint partnership between Beacon Hill Village and NCB Capital Impact and was developed in response to requests from Villages nationwide.

About Beacon Hill
Beacon Hill Village is a membership organization in the heart of Boston. Created by a group of long-time Beacon Hill residents as an alternative to moving from their houses to retirement or assisted living communities, it was founded in 2001.

Beacon Hill Village enables a growing and diverse group of Boston residents to stay in their neighborhoods as they age, by organizing and delivering programs and services that allow them to lead safe, healthy productive lives in their own homes. For more information, visit: www.beaconhillvillage.org

About NCB Capital Impact
NCB Capital Impact, the non-profit affiliate of NCB, provides financial services and technical assistance to create more affordable cooperative homeownership, long-term supports innovations, and facilities for health care centers and charter schools. Headquartered in Washington, D.C., NCB Capital Impact has offices in California and New York. To learn more about NCB Capital Impact, and its programs and initiatives in advancing education, affordable housing, health care and long-term care for low- to moderate-income individuals, visit www.ncbcapitalimpact.org or contact Charity Sack at (703) 647-2337.



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