How Are Seniors Spending Their Money?
by Pamela Villarreal
January 22, 2014
Source: LifeHealth Pro
Just 20 years ago, most seniors entered retirement debt-free. Now, experts wonder if retirees will able to make ends meet throughout the rest of their lives, much less not outlive their money, says Pamela Villarreal, a senior fellow with the National Center for Policy Analysis.
How have spending patterns changed for today's seniors compared to years past? Using data from the Bureau of Labor Statistics' Consumer Expenditure Survey and the Federal Reserve Survey of Consumer Finances, one can compare the spending habits of today's seniors with the spending habits of those who retired 20 or more years ago.
- More seniors carry mortgages and spend a greater share on interest payments.
- The Survey of Consumer Finances shows that since 1989, the percentage of 65 to 74 year olds reporting a mortgage or home equity loan holders increased from 21 percent to nearly 37 percent in 2010.
- For seniors 75 years old and older, the percent of mortgage or home equity loan payments increased from just 6 percent to 21 percent during the same time.