W: The Planner, The Chosen (3 page)

“I’m not a gossip.  If I were, I would never have lasted nineteen years in Arizona real estate. Discretion is a big component of the real estate business, in both the public and private sector. I don’t have a problem with your conditions.”

“Fine,” Scott picked up the signed forms.  “Time is of the essence. The Administration wants to get Smart Seniors underway immediately. Unfortunately, because what you are going to be doing is complex, you need to undergo training before you can start. Normally, for training of this magnitude for a project this important we would send all of the Planners to the Federal Municipal Planning Division headquarters in Virginia, but because we have so many new hires, and we need to get everybody on the ground running, we have brought the trainers to you. Training sessions will last three weeks; during that time you will receive your materials, you will learn every aspect of the Smart Seniors Concept, and you will familiarize yourself with the exact requirements of your job. The day after the classes end, we expect you to be able to go out into the field and start selling the community. The first session begins tomorrow at 7:30 A.M. and goes until 5:00 P.M. with an hour and half break for lunch. Give these forms to my executive assistant, and she will give you a badge that will admit you to the class.  Representatives of the Federal Office of Personnel Management will be here on the third floor every day from 11:00 A.M. to 1:30 P.M. to assist all new hires with setting up your payroll and explaining how your benefits package will work.”

“Great.  Thank you—very much,” Kris stood and shook both their hands. “I am looking forward to starting.”  Leonard and Pat returned her handshake stiffly and without much enthusiasm. Kris felt self-conscious. She reminded herself that she had never worked for the government before—in a few weeks she would know the appropriate tone for these people, but, for now, her old private sector enthusiasm was spilling out a little.

After picking up her badge, she stopped by Westmore Real Estate to pick up her final check from the cash sale that had closed the week before and to explain that she had gotten a new job and would be starting immediately. Carol, the receptionist-bookkeeper was at lunch, and Kris had to wait for an hour for her to come back, since she did not want to tell Doug that she had a new job until she had her check.  As soon as she had it in her purse, she broke the news to Doug and then rushed straight to the bank to cash the check—just in case he decided to stop payment. She probably had nothing to fear—he seemed not to care one way or the other and probably didn’t since she had closed so few sales since coming to work there, but Kris wasn’t taking any chances.

She had enough money to pay her credit card bills, rent a room for five nights at the Super Sleep, and buy food if she shopped carefully. That would take her through the end of the week. She wondered if her new government-furnished housing would require any sort of a deposit. She would work something out—now that she was officially employed she could get a very short-term loan from her parents if she absolutely had to until she got paid.

As she lay in bed that night, it occurred to Kris that for the first time in years she would not have to worry about where her next payday was coming from. No more struggling to find a place to live or dodging phone calls from persistent bill collectors. No more putting up with some low-life like Nick because she had no choice. Tomorrow she would start training, and in three weeks she would actually be working in a new career with a regular salary. She would have a retirement plan. She would even have an apartment.  It would be a very modest apartment, no doubt, but that was fine.  It was hers—she did not even have to go looking for it.  The long, stressful nightmare that Kris had called her life for the past four years had finally ended.  The future was going to be great.

S
even-thirty the next morning found Kris sitting at a small laminate table in an uncomfortable plastic chair in the training room of the Federal Municipal Planning Division Building. Being on time for a 7:30 class meant arriving at 6:30 to get through the army of unsmiling faces and the line of metal detectors which stood between her and her classroom. What’s more, unlike the other early morning meetings and training sessions she had spent years attending which rewarded those who got up before sunrise with sweet rolls and juices, FMPD did not furnish trainees with so much as a piece of toast. There was not even enough coffee, and there were only a few small paper cups. “Quit whining,” Kris chastised herself at her own disappointment when she discovered that she would not be getting a hot beverage—or any beverage at all except possibly a drink from the water fountain on the break.  “You can do anything for three weeks.  You’re lucky to be here at all.”

As the training attendance roll made its way around the room, Kris examined the glossy red, blue, and white brochure in front of her. On the cover was an extremely attractive silver-haired couple seated on a wooden bench atop a grassy hill canopied by stately old trees. In the background other couples could be seen—walking dogs, chatting with friends and enjoying the outdoors. The couple in the foreground held hands—the man rested his head lightly on the woman’s shoulder.  In her other hand she held an electronic reading device as she enjoyed a book or magazine on what appeared to be a perfect summer day in a beautiful park. The picture was captioned
, “You Worked Hard Your Whole Life. Now it’s Your Time to Enjoy the Stress-Free Future You Deserve.”
Inside the brochure was another photo of the same couple sitting at a table in an elaborate dining room. A wait staff person dressed in white had just set a plated meal in front of them. The woman had dressed for dinner in a royal blue blouse and skirt and her husband was wearing a sports coat and dress pants. At other tables, similarly-attired couples were laughing and talking.  On each table a candle flickered atop a decorative centerpiece, adding just a touch of romantic light to stage the scene for what appeared to be a delightful evening. The caption on this page read, “
Savor the joys of worry-free living.”

The attendance roster was finished. “Good morning, everyone, I am Janice Highwater. I am the assistant to the Assistant Secretary of the FMPD, and I want to congratulate all of you on your new positions as Planners. You have joined our Agency at an amazing moment; you are going to be a part of the most ambitious, innovative project that our government has attempted in over two hundred years. For the next three weeks, I will be your trainer, and I will teach you everything you need to know about how to present this exciting new plan to the community.”

Janice Highwater had been a professor for most of her life—that was her primary qualification for her job as the assistant to the Assistant Secretary. So she began this class as she had begun all her classes during her twenty-year teaching career—by asking each participant to introduce himself and describe briefly his work experience prior to starting with FMPD.

When that exercise was finished, she began. “I was a professor of social sciences for twenty years.  I have lectured and written extensively on the needs and challenges that our society will face due to our aging population. When the Administration asked me to join the FMPD, I was thrilled.  This was a chance to work with a great team to put into action everything that I had written as theory. You are now part of that team.

“I want to start by giving you some background about what we as a country are facing. Our population is aging at a faster rate and as a faster percentage of the population than ever before in human history. In the 1930’s, only seven million Americans were fifty or older—under six percent of the population. About three years ago, we began to see the over-fifty population swell as the first wave of Baby Boomers reached retirement age. In 2012, the U.S. population of persons age fifty and over reached one hundred million people. Studies by the U.N. Population Division indicate that by the year 2035, twenty percent of the U.S. population will be over sixty-five years of age. 

“Obviously, this has created great challenges for our society and for our government. When the Social Security system was introduced, the average life span was about sixty-seven years. If Americans retired at sixty-five and started collecting their benefits then, they collected for an average of two years.

“But today, Americans are living longer than ever before.  The fastest-growing segment of the U.S. population is Americans eighty and over. The growth rate for this sector is four times that of the total population. By 2050, we expect the U.S. to have over nineteen million people in the over eighty years of age population group.

“The average American can expect to live twenty to twenty-five percent of his or her active life in retirement.  Since the year 2011, we have been adding ten thousand new retirees to the Social Security and Medicare rolls per day.  Between now and 2031, our country will see seventy-four million Baby Boomers retire. Right now, the U.S. population of people over sixty-five outnumbers the combined populations of New York, London and Moscow. And this is not just a U.S. phenomenon—worldwide there are more people over sixty-five than the entire populations of Russia, Japan, France, Germany, and Australia combined.  Worldwide, people over sixty-five now outnumber children under age five.

“Given these facts, we have a huge challenge on our hands. The present system of Social Security and Medicare was created for a society where people of retirement age were a small minority of the population—less than six percent.  These programs were never designed to provide benefits for twenty to thirty percent of the nation’s population.

“Unfortunately, the politicians did not look up and see that the light at the end of the tunnel was actually an on-coming train until just a couple of years ago. Then, suddenly, people looked around and realized, ‘Hey, we’ve got all these people about to retire and no way to pay for them.’ And after taking a hard look at the numbers, they realized that Social Security was actually going bankrupt. In fact, we realized by 2011 that the Social Security fund would actually be in the red in ten years.

“The current Administration is dedicated to fixing the problems resulting from an aging population and the Social Security shortfall. We want all of our seniors to be able to enjoy their best years free of the worry and stress of fearing what will happen if one day that Social Security Direct Deposit doesn’t come because the government is out of money. But we also recognize that Social Security was in many ways a panacea that did not solve all or even many of the problems of the elderly. That is why the Administration is launching Smart Seniors—we want a holistic approach to senior living that will solve not only the problems of Social Security and Medicare but all of the problems that seniors face. Over the next three weeks, we are going to teach you how to think about a whole new way of living. Smart Seniors is not just about
where s
eniors live; it is about
how
they live.  That’s the main message you have to communicate when you are selling this program to the community—this is not about replacing your Social Security check; this is about a whole new concept of retirement.”

The class took a fifteen minute break, and then they were back in their seats. A middle-aged man sitting across from Kris raised his hand to ask their instructor a question.  Janice acknowledged him. “Okay, you keep talking about replacing your Social Security check. I was under the impression that we were selling housing. What does housing have to do with Social Security payments?”

“You’re compartmentalizing,” Janice replied without answering his question. “You have to begin to think holistically to understand the Smart Seniors concept. During the course of this training, you will begin to see how all of these issues work together.”

“Okay,” Janice continued. “I have a question for you.  Who can tell me the answer first? What is the biggest recurring expense for people over age sixty-five in the U.S.?”

Several hands went up, including Kris’.  The owners of the multiple hands called out “health care,” or “medical care” or “prescriptions,” but Kris knew the correct answer, and she knew it didn’t have anything to do with medicine.

When the other answers had been given, Janice finally acknowledged her. “Housing is the biggest recurring expense for seniors,” Kris answered confidently.

“Correct.”

The middle-aged man once again raised his hand, “How can it possibly be housing? Don’t most seniors have their houses paid off?”

Kris looked at him but said nothing. “Would you like to answer that?” Janice asked her.

“Certainly. Yes, a majority of people age sixty-five and older have their homes paid for or are close to it. However, they still have property taxes and insurance in addition to repairs and maintenance on their housing. As people get older they tend to be able to do less for themselves, so they increasingly need to hire others to do the maintenance or to assist with housekeeping and lawn services. Even though the house may be paid for, often the retiree’s income is significantly reduced, so as a percentage of their total income, these expenses are big.”

“What about people who get ‘reverse mortgages?’”

“What about them?” this time Janice answered. “A Home Equity Conversion Mortgage, commonly called a ‘reverse mortgage’ can help seniors use the equity in their homes to get some extra money to cover living expenses. But what a lot of people don’t understand is that even though seniors do not have to make payments on reverse mortgages for as long as the youngest of the two borrowers or spouses lives in the home, the borrower is still responsible for the taxes and insurance on the property. Failure to pay the taxes and insurance causes the loan to default. In other words, your home can go into foreclosure because you can’t afford to pay your property taxes or your insurance.”

Gasps of “Wow!” went around the room. Kris, of course, didn’t gasp—she already knew this information.

“So, let’s take a look at this,” Janice clicked to begin a Power Point presentation featuring a pie chart. “The average Social Security benefit nationwide for a sixty-five year old retired worker is $1230.50. Let’s suppose that our worker has a spouse who did not work enough to receive his/her own benefits—the average Social Security benefit for the spouse is $608.00 per month. Combined, we have an average monthly income of $1838.00 per month. Let’s say that you are a retiree and your house is paid for.  And let’s say that the value of that house is $350,000—in 2006 that was about the average price of a home in Arizona, and if you are now retired, it’s probably a good bet that you bought your house when the prices were up. If today your house is valued at $350,000 you have an annual tax rate on that house of $3500.00—just a hair shy of $300.00 a month. You also have insurance. Let’s say that the insurance is about $150.00 a month. Then you have utilities. Suppose your utilities—water, gas and electric, run another $300 a month. You are up to $750.00 a month just for taxes, insurance, and utilities.  So at the same time that the government is struggling to come up with ways to pay you, you, the retiree, are struggling to come up with ways to pay for a house that you don’t need any more.”

Kris knew that she was going to regret this, but she asked the question anyway. “Shouldn’t we be taking into consideration that the majority of retired people have income in addition to Social Security? And those who don’t probably are living in cheaper housing with lower taxes and insurance?”

Janice glared at her, “According to the Social Security Administration, forty-one percent of the income of people over sixty-five is Social Security. Fifty-four percent of married couples and seventy-three percent of unmarried individuals derive fifty percent or more of their income from Social Security.  Twenty-two percent of married couples and forty-three percent of unmarried individuals depend on Social Security for ninety percent of their income. For these individuals and couples, that check is basically all the money they receive.  And, yet, a big block of it is going to put a roof over their heads.

“Our system is designed to overlook the less fortunate seniors—those who are alone through death or divorce, those who, perhaps, were not as upwardly mobile, those who experienced the hardships of life and did not save enough.  We give them barely enough to hang on and then a big block of that money goes to putting a roof over their heads. This is the kind of inequity that the Retire America Act is designed to correct.

“Retire America will level the playing field between the more fortunate and less fortunate senior populations. Phase I began last year when the Act was passed by levying a tax on all retirement accounts, 401ks, and IRAs.  By applying a thirty percent tax to all of these accounts nationwide, we were able to allocate the funds we needed to pay for the pilot senior communities.

“The next phase starts in 2016. At that time, all of the private retirement accounts in the United States will be rolled into the Retire America Fund. The U.S. government will completely back this new fund.”

Several hands went up at once. Janice recognized a bony-faced woman sitting two rows up from Kris. “Yes, Lisa.”

“If all the money goes into the Retire America Fund, then how will people manage their money? Will we get statements every month or every quarter?”

“Once the Retire America Fund goes fully into effect Americans will no longer receive statements about their retirement funds. All of the money will go into a common fund, and as you retire you will receive it back again in the form of community credits.”