The fear of poverty and outliving one's resources is an increasingly common experience among today's senior citizens. For millions of American seniors this fear is justified. In only four years, the number of seniors at risk of outliving their resources increased by nearly 2 million households. Using the Senior Financial Stability Index, economic insecurity among senior households increased by one-third, rising from 27 percent to 36 percent from 2004 to 2008. This steady and dramatic increase occurred even before the full force of the Great Recession hit. With effects of the recession impacting all demographic groups, economic security of seniors has deteriorated further.
Contrary to the popular belief that seniors have ample time and resources for a fulfilling retirement, objective measures show a dramatically different story. In fact, more than one of every three seniors (36 percent) is economically insecure today as measured by the Senior Financial Stability Index. Combined with the 40 percent of senior households that are financially vulnerable (neither secure nor insecure according to the Senior Financial Security Index), three-quarters of all senior households find themselves in an economically precarious position with little or no buffer against financial ruin should they be faced with an unexpected illness or other traumatic life event.