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Turning gray into red

1 in 3 seniors continue working after retirement to afford health care (Survey)

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Key takeaways

  • 1 in 4 seniors that sold their home in the past two years did so to afford retirement.
  • Almost 43% of seniors agreed the next generation was likely to suffer from the same or worse financial burdens.
  • 2 in 5 seniors reported living paycheck to paycheck.

Presumably, you’re planning on living well into old age. But, today, achieving senior citizen status comes with a host of financial challenges, from budgeting inadequate retirement savings to dealing with the rising cost of living.

We recently gathered detailed financial information from 1,000 U.S. residents aged 55 and older. We asked them to share their biggest financial burdens, fears and plans for retirement. If you’re curious to see how your financial future may look — and are interested in preparing yourself for the challenges associated with retirement in today’s economy — we’ve got some data for you.

Senior citizen finances: Status quo

The research begins with a look at the overall financial health of Americans 55 and older.

graphic depicting an overview of senior finances

The average retirement age in the U.S. is currently 62; of the survey respondents who were still working, 2 in 5 were living paycheck to paycheck despite potentially retiring within the next decade. While living this way is the reality for 61% of Americans overall, senior citizens are expecting to have no paycheck whatsoever in the very near future, making their lack of financial security all the more alarming.

The No. 1 financial burden among seniors was their mortgage and/or rent payments, according to 24% of respondents. Renters of all age groups have recently faced intensely sharp increases in rent, with price hikes up to 40% in some areas forcing many to leave their homes. In second place is inadequate retirement savings, the biggest financial concern for 17% of seniors surveyed.

Biggest money worries among seniors

The seniors we spoke to shared some of their specific concerns in terms of finances. Notably, fears surrounding the affordability of assisted living seemed to be the most common, with over 60% of all seniors surveyed sharing this concern.

graphic depicting seniors' financial fears

Having an expensive medical issue was another understandable fear, motivated by the burden of health care costs in America. Even without a major medical issue, senior health care costs average upward of a quarter of a million dollars per retired couple. This fear also motivated many to keep working into their old age — 1 in 3 were still working simply to maintain access to health care, in spite of 1 in 4 saying they were embarrassed to work past retirement.

Unfortunately for younger readers, nearly half of all seniors agreed that younger generations won’t have it better — and it’s true that Gen Zers and millennials are facing unprecedented retirement hurdles. Increasing life expectancy means inheriting wealth later, and many feel they can’t rely on Social Security benefits. That said, there are ways to prepare for retirement and drastically improve your chances of a healthy financial future.

Seniors forced to sell their homes

With mortgage and rent payments comprising the single biggest financial burden among U.S. seniors, we wanted to know how they were addressing these constraints. The last section of the study looks at the number of seniors who have sold their homes recently and how this choice has impacted their financial standing.

graphic depicting housing concerns for seniors

Twenty percent of all respondents had sold their homes within the past year alone. While selling one’s home out of necessity isn’t ideal, it’s certainly a seller’s real estate market today, with some experts calling it the “mother of all seller’s markets.”

Graceful financial aging

While seniors did share some major financial stressors and worries (not being able to afford a mortgage, having an expensive medical issue and working past retirement despite being embarrassed to do so), there were some significant silver linings. The vibrant seller’s real estate market lately afforded seniors the ability to sell their homes, get out of debt, officially enter retirement and move closer to their families.

Fifty-eight percent had more money to live on, while 44% were able to make their money work harder for them (likely through paper investments). Forty-three percent said selling helped get them out of debt, while 16% were able to move closer to family. And the ultimate goal for many seniors — retirement — became achievable for 25% percent of those who sold their homes.

Methodology

We surveyed 1,000 Americans over 55. Fifty-five percent were men; 45% were women. The average age of respondents was 66, and ages ranged from 55 to 79.

To help ensure that all respondents took our survey seriously, they were required to identify and correctly answer an attention-check question.

Fair use statement

Knowledge — like financial know-how — is power. If you have any senior friends or family members you think would benefit from the findings of this study, you’re welcome to share it. Just be sure your purposes are noncommercial and that you link back to this page when doing so.

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