Healthcare Costs Skyrocket, but Housing Still No. 1 Expense for Seniors

Ranking an even higher expense than health care costs for people ages 50 and over, home-related expenses mark the highest spending category for Americans in retirement, with health costs a rising second, according to data released this week from the Employee Benefit Research Institute (EBRI).

“Home and home-related expenses remain the single largest spending category for older Americans, followed by health care expenses,” said Sudipto Banerjee, research associate with EBRI and author of the new report. “However, health care spending is the only component which steadily increases with age: It captures around 10 percent of the budget for those between 50–64, but increases to about 20 percent for those age 85 and over.”

On average, those over age 50 spend around 40-45% of their budget on home and home- ̶related items, according to the study.


Retired households, on average, spend about 80% of what working households spend, while their average earnings are only about 57% of what working households earn, EBRI finds. Household consumption declines with age (see chart) and health care expenditure is the only spending category that steadily increases with age.

Written by Elizabeth Ecker

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