10 Million Seniors Face Poverty Despite Housing Wealth

Approximately 10 million Americans aged 65 and older experienced poverty in 2025, according to a new analysis by the AARP Foundation utilizing U.S. Census Bureau data. This figure represents a poverty rate of 15.4% for this demographic under the Supplemental Poverty Measure (SPM), marking the highest rate among all age groups. The SPM, which accounts for essential expenses such as out-of-pocket medical costs, provides a more comprehensive picture of financial hardship than the official poverty measure. Under the official poverty measure, the poverty rate for adults 65 and older in 2025 was 9.8%, or about 6.4 million individuals. The significant difference between the two measures underscores the impact of healthcare expenditures on senior financial stability, particularly for those managing medical conditions even after Medicare benefits are applied.

This situation presents a stark contrast to the prevalent narrative of aging Americans accumulating substantial wealth, much of which is tied up in home equity, and expecting to pass trillions of dollars to heirs. Joel Berner, a senior economist at Realtor.com®, explains this apparent contradiction by pointing to two primary factors. Firstly, aggregated wealth statistics are heavily influenced by high-net-worth seniors. Individuals who do not own homes are considerably more likely to face poverty, meaning both scenarios—immense housing wealth and widespread poverty—can coexist within different segments of the senior population. This indicates that homeownership alone does not guarantee financial security for all older adults.

Secondly, even for seniors who own their homes, their housing wealth is often illiquid. This means the value of their homes cannot be readily converted into cash to cover daily necessities like groceries or utility bills without selling the property or borrowing against it. Consequently, many older homeowners find themselves "house-rich and cash-poor." This lack of accessible funds can create significant financial strain, even when substantial equity is held in real estate. The housing shortage can further exacerbate this issue by trapping older homeowners in their current residences, preventing them from downsizing and accessing their equity.

The AARP Foundation's analysis highlights the critical need to address the financial vulnerabilities of older Americans. The SPM's ability to incorporate out-of-pocket medical expenses is particularly crucial for understanding the financial pressures faced by seniors, who often incur high healthcare costs. This data suggests that while many seniors may possess significant assets in the form of housing, their immediate cash flow and ability to manage unexpected expenses, especially medical ones, remain a significant challenge, leading to widespread poverty despite accumulated wealth.