Is Prison the New Retirement Home?
n my economic commentary, I often say you should watch other countries who are older or more in debt to see what will happen to us. Well 27.3% of Japan's citizens are 65 or older (practically twice that of the U.S.), and these seniors are breaking into prison just to survive! Will American retirees be forced to do the same? Not if they start planning now with a financial professional. Here's a look at Japan's rampant retiree "crime-spree" and some solutions you can use to keep your clients from getting locked up.
An article in Straits Times is titled "Rise in Old Jailbirds Turns Japan Prisons into Retirement Villages." It points out that a record 47,632 people in Japan aged 65 or over were arrested in 2015. Over 70% were caught for petty crimes such as shoplifting. When retirees have to steal just to survive, it's clear that their plan didn't include enough guaranteed lifetime income to cover basic living expenses. What's worse is that Japan's elder inmates are "rehabilitated," kicked back into society, and stuck in the same boat they were before: they haven't gotten any younger, and they still don’t have enough income! So do they get a job and start saving for their slow-go years? No, they steal a bunch of bananas for breakfast and get thrown right back into the slammer! About 70% of all current inmates aged 65 or older are repeat offenders.
Why do these seniors live this type of retirement? Well besides their lack of guaranteed lifetime income, their retirement didn’t include any plan for long-term care either! But prisons did: A roof over their heads, three square meals a day, no utility bills, and unlimited free healthcare are all provided. A research firm coined Japanese prisons “state-sponsored retirement villages,” and one prison’s demographic includes a 50.6 age average with the oldest being 88. That same prison was recently refurbished to accommodate their demographic including 500 “private, well-lit cells, each with its own desk, chair, wooden bed, and television set. Steps in public areas are [even upgraded] with ramps and handrails.” Does that sound like a prison to you? Or is it closer to the retirement home where you and your clients visit the grandparents?
By 2025, one in three citizens of Japan will be aged 65 or older, and one in five will be 75 or older. 2025 isn’t that far away, and the U.S. demographic isn’t getting any younger. Let’s take a look at YOUR plan now. Medicaid and Medicare are drastically underfunded and facing problems similar to Social Security. Still, it’s better than NO plan, and a ward of the state doesn’t have to live on the street and steal bread. As a financial professional you can help retirees live more comfortably in their twilight years. My plan allows me to stay in my home, have the nurse come to me, and I get to PICK the nurse I want! Every retirement is a little bit different, so here are a few products you can tell your clients about.
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