Under New Math, 1 in 5 Seniors Is Poor

Outmoded federal statistics don't reflect reality, group says
By Kevin Spak,  Newser Staff
Posted Sep 4, 2009 9:57 AM CDT
The elderly are nearly twice as poor as previously believed under a new method of calculating the poverty level.   (Getty Images)
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(Newser) – Based on official statistics, only 10% of Americans aged 65 and older are poor, the lowest rate of any age group. But the actual number should be nearly twice that, finds the National Academy of Sciences, which has developed a new, modern way of calculating poverty that is quickly gaining favor in Washington. It accounts for things like medical expenses and local cost of living.

The current federal poverty level calculation, devised in 1955, is set at three times the presumed cost of groceries nationwide—for a family of four, that's $21,203—ignoring all other factors. “It’s a hidden problem,” says the president of the AARP foundation. The new system would include a host of other factors, including non-cash government aid, transportation costs and more. The overall poverty rate would jump from 12.5% to 15.3%; among the elderly, it would be 18.7%.