According to a new study from the National Center for Policy
Analysis (NCPA), “How Are Baby Boomers Spending Their Money?,” many are not
saving enough for retirement.
Among those ages 55 to 64, mortgage interest was a major
factor in increased housing costs, making up a larger share of expenditures now
– 6.3% compared with 4.3% – than for this age group 20 years ago, despite fallen
“Unfortunately, a greater percentage of pre-retirees will be
dragging mortgage debt into their retirement years,” said National Center for
Policy Analysis (NCPA) Senior Fellow Pam Villarreal. “This is a time when
major debts should be pared down. Instead, many are taking out longer mortgages
and home equity loans, spending more on interest payments and are, overall,
buying too much house.”
Education expenditures have also increased – up 80% for 45-
to 64-year-olds and 22% for those 55 to 64 – in part due to Boomers covering
the loans of their adult children. Two in five have paid off their children’s
debts, including 29% who paid student loans. Among parents whose children are older
than 18, 59% reported providing financial support to adult children who are no
longer in school, covering expenses such as transportation costs (41%) and
medical bills (28%).
The study is available here.