The economics and reality of aging

Students who hear professor Jost Lottes lecture on the economics of aging and how it will affect them and their parents are shocked by what they hear.

Social Security and Medicare are running huge deficits. Parents are losing retirement money … will the children have to step in and support them in their old age?

Parents of many of today’s college-age students are baby boomers or older. Many have lost 50 percent of their retirement savings, and many more have been cleaned out, Lottes explained.

Lottes teaches these principles of aging in his graduate class Economics of Aging, and he poses serious questions that are looming ahead for students ages 18–26: Will there be Social Security to depend on? What about pensions? Home equity is something to fall back on, but today 35 million Americans are over 65 years of age and 70 million will be in that category in 35 years.

Lottes said that anyone now in their 20s may easily live to 90 or 100, which many of his students have a hard time believing at first. Lottes said it is imperative to prepare for a long life.

“The average American expects to outlive their savings. A person age 65 today and who lives another 18 years will have his savings run out,” he said. “Sons and daughters are going to have to provide hands-on care for their parents. Contrary to belief, the vast majority of the elderly are cared for by family, friends and neighbors. They are not in nursing homes.”

To that end, he mandates interaction with people in their 70s, 80s and 90s so students can be more aware of the elderly.

He focuses students’ attention to the life they want to live now, in preparation for tomorrow. He advises them to watch their health, exercise, develop lifelong friendships and pursue multiple interests.

Lottes said most of his students just want a degree. He sees great career opportunities in gerontology in light of the aging population, and because doctors are ill prepared to treat older adults.

Only a handful of health care professionals in Portland have geriatrics as a specialty, he explained.

“Right now, I’d be very worried about employment if I am graduating this spring. I recommend going into this field, not just as a physician, but all business should be marketing to baby boomers and older adults,” he said.

Because his class focuses on economics, he has all students get a Social Security report so they will know what they can expect at age 65.

He also touches on the sociological and psychological aspects of aging, with the opinion that television presents stereotypical images that are negative.

“My class is intended to open minds and to impart the idea that aging is an aspect of diversity. The average student is very sheltered and has no idea,” he said. “The class is a huge eye-opener. If you think you’re going to work at a job you hate and retire and then live the life you always wanted, you’d better focus on how you want to spend your life from now on.”

Lottes had a chance to reevaluate how he was spending his time. Before coming to Portland State, he worked in marketing for a fashion house in New York. The company asked him to do a study of their clientele. He found the average age was 43 years.

Jones New York was “devastated, so I had to go back and say it was 39,” he said. “But it opened my eyes to a new challenge.”

That is how he decided to go to Portland and study gerontology. In addition to teaching classes, Lottes also is the director of the Senior Adult Learning Center, where 700 senior citizens audit classes at no cost.

Lottes, in congruence with the lifestyle he advocates to students, began traveling with his family at age 3, when he visited South Africa for the first time. He has been in 80 countries, including his home country Germany, and is on the road to marriage.

Many of Lottes’ classes serve as warnings of a world rapidly changing, one where today’s youth will have to be more proactive as they age.

“It will be a different world when these students are seniors,” Lottes said. “There have been lots of workers paying into Social Security, with 16 paying in for every worker collecting benefits. Twenty years from now two workers will be paying into it for every person collecting. Social Security may pay out to only certain low-income levels. Students of today may have to pay more.”