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What Is The Cost Of Aging And Growing Older In America?

senior woman in a city

As people age and enter older ages, they face a range of challenges, including declining health, limited income, and social isolation.

These challenges often come with significant financial burdens, making it critical to understand the cost of aging in America.

This article takes a realistic look at the costs associated with aging, including healthcare, income and retirement, housing, transportation, and community and social support.

Health Care Costs

Healthcare costs are among the most significant expenses facing older adults in the United States.

As people age, they are more likely to develop chronic conditions, which can lead to increased medical expenses.

According to the National Council on Aging, the average older adult in America has at least one chronic condition, and one in four has two or more.

An article from CNN Money estimates that the average 65-year-old man will spend $189,687 on healthcare in retirement, while an average 65-year-old woman will spend $214,565. Because medical situations and their attendant costs are unpredictable, they are one of the key reasons seniors need to seek alternate sources of income and understand how to plan for healthcare expenses during retirement.

Medicare And Medicaid Expenses

Medicare and Medicaid are two federal programs that provide health insurance to older adults and people with limited income.

While Medicare covers many medical expenses, it does not cover all costs, and many older adults face out-of-pocket expenses, including premiums, deductibles, and copayments.

Medicaid, on the other hand, covers a broader range of services, including long-term care and in-home care.

Long-term Care Costs

Long-term care is a significant expense for many older adults, particularly those with chronic conditions or disabilities.

Costs vary greatly from state to state but on average (as of 2021) a semi-private nursing home room is about $8,000 per month.

The average cost of a private aide ranges from $14 to $30 per hour.

Prescription Drug Costs

Prescription drugs are another significant expense for older adults. Many older people require multiple medications, which can add up quickly.

According to the Peter G. Peterson Foundation, the average annual cost of prescription drugs for one person was over $963 in 2019.

This is a significant financial burden for people with limited income.

Income and Retirement

Many older adults rely on Social Security benefits, retirement savings, and pension plans for their income in retirement.

However, these sources of income may not be enough to cover basic expenses, particularly for those with limited income.

The average monthly social security check that seniors receive is $1693.88 (source:

Of course, this amount varies depending on a person’s earnings history and other factors.

Social Security Benefits

Social Security is a federal program that provides retirement, disability, and survivor benefits to eligible individuals.

While Social Security benefits can provide a critical source of income for older adults, the number of benefits may not be enough to cover basic living expenses.

In fact, according to the Elder Index, at least two-thirds of older Americans living alone, and half of older women living with a spouse or others do not have enough income to cover basic expenses. (source:

Read about the age at which you can stop filing income taxes.

Retirement Savings

Many older adults have some type of retirement savings accounts, such as 401(k)s or IRAs.

However, not everyone has access to these accounts, and even those who do may not have saved enough to cover their expenses in retirement.

In 2021, 87 percent of U.S. citizens who were 60 years old or older had some type of retirement savings.

According to Federal Reserve SCF Data, the median retirement savings balance for people ages 65-74 was only $164,000 in 2020. (source:

Read about the best month to retire for tax purposes here.

Pension Plans

Pension plans are another source of retirement income for some older adults.

However, many employers no longer offer pension plans, and those that do may not provide enough income to cover basic expenses.

Read about the states that don’t tax retirement income here.

Housing and Transportation

Housing and transportation are essential expenses for older adults, particularly those who own homes or live in rural areas.

Housing Costs For Seniors

Housing costs can be a significant financial burden for older adults, particularly those who own homes. Property taxes, home maintenance, and repairs can add up quickly.

Additionally, many older adults may require modifications to their homes to accommodate mobility issues or disabilities.

Housing is one of the essential expenses that older adults face. According to the National Council on Aging, about 1 in 3 older adults owns their homes free and clear.

However, for those who still have mortgages or rent their homes, housing costs can be a significant burden.

For instance, older adults who rent homes in the United States spend about 30% of their income on housing, while those who have mortgages spend around 16%.

Moreover, property tax and home insurance rates tend to rise as people age, making the cost of living in their homes higher.

To offset this burden, some states, such as New Jersey and New York, offer property tax relief programs for older adults.

It’s essential to note that geographic variations can affect the cost of housing for older adults. For example, housing in rural areas tends to be cheaper than in urban areas.

Transportation Expenses For Seniors

Transportation is another significant cost for older adults. Some older adults have difficulty driving, and as such, they rely on public transportation or taxis to get around.

This can be costly, especially for those who live in areas without reliable public transportation.

Seniors living in rural areas may have to pay more for transportation help than those living in urban or suburban areas. I’ve seen this described as “rural tax.”

But, there may be a volunteer service near you. Take a look at this map for transportation services run by volunteer organizations in your area.

It can also be helpful for older adults to look into ridesharing services like Uber or Lyft. These services may be more affordable than traditional methods of transportation and can provide seniors with more options for getting around.

Finally, it is important to remember that many communities have senior centers or other local programs that provide free rides or discounted fares for older adults.

Seniors should take advantage of these resources whenever possible to save money on transportation.

No matter where you live, it is important to plan ahead and be aware of the different options that are available for seniors when it comes to transportation help.

By utilizing these resources, older adults can save money and find more convenient ways of getting around.

Senior Services

As we all grow older, we will inevitably need help with the activities of daily living. Senior services can come in many forms, from assisted living facilities to home health care and beyond.

It is important to plan ahead for these expenses, as they can quickly add up.

Cost of In-Home Care And Assistance

As people age, they may require assistance with daily activities such as bathing, dressing, and cooking.

The cost of in-home care can be high, especially if the older adult requires round-the-clock care.

According to the

As of Mar 24, 2023, the average hourly pay for a Home Health Aide in the United States is $13.42 an hour.

The cost of in-home care can vary depending on whether you hire an aide through an agency or a private person and also where you live.

According to ZipRecruiter the most expensive state to hire a Home Health Aide is Washington state and the least expensive is North Carolina. You can see the comparisons of the average wages here.

Assisted Living And Nursing Home Care

Assisted living and nursing home care are options for older adults who need round-the-clock care.

However, these options can be costly, with the national median monthly rate for assisted living being $4,300 and the national median daily rate for a private room in a nursing home being $290.

Again, the cost can vary depending on the location, with some states having higher rates than others.

Community Support Programs For Seniors

Fortunately, some community support programs exist to assist older adults in meeting their basic needs.

For instance, the Older Americans Act provides funding for programs that promote the health and well-being of older adults.

Some of these programs include home-delivered meals, transportation assistance, and caregiver support services.

Additionally, some states offer programs that provide housing assistance, food stamps, and financial assistance for medical expenses.

Read our article on support services for older adults.

Divorce And Widowhood

One factor that is often overlooked when calculating the cost of aging in America is that of divorce or widowhood.


The number of older Americans getting divorced has been on the rise in recent years. Divorce can be difficult for anyone, but more so for older adults who may be dealing

With marriage comes the risk of a marital dissolution via divorce or widowhood, which have both been prevalent among older adults. While 34% of women and 33% of men ages 20 or older who ever married had ever divorced, the percentage of adults 55 to 64 years whoever divorced is much higher: about 43% for both sexes.

Divorce can be extremely costly, with the average divorce costing over $15,000.

This cost is often higher for older Americans who are more likely to have assets such as property and retirement accounts that need to be divided up.

In addition, there are other hidden costs associated with divorces such as legal fees and court costs. This added expense can be a burden for many older Americans who are already on a limited income.


Besides the emotional toll, widowhood can also have a financial impact on older Americans.

Here are a few ways in which this can play out:

  1. Loss of Social Security Benefits: If the deceased spouse was receiving Social Security benefits, the surviving spouse may be eligible for survivor benefits. However, the amount of the benefit may be reduced if the surviving spouse also receives their own Social Security benefits.
  2. Loss of Pension Benefits: If the deceased spouse had a pension plan, the surviving spouse may be entitled to some or all of those benefits. However, this may depend on the specific terms of the plan.
  3. Increased Healthcare Costs: As people age, they tend to have more health problems, and this can be especially true for those who have lost a spouse. In addition to the emotional toll of losing a partner, the surviving spouse may have to deal with additional medical expenses.
  4. Housing Costs: Losing a spouse may also mean a change in housing arrangements, which can be costly. For example, if the surviving spouse was living in a house owned by the deceased spouse, they may need to move to a smaller, more affordable home.
  5. Paying For Services: I know that after my husband passed away I found that I have to pay for handyman services, car repair services and general home maintenance services. All the things that he used to do are now having to be assigned to someone else.

Overall, the financial costs of losing a spouse can be significant for those growing older in America.

It’s important to have a plan in place for dealing with these costs, whether that involves seeking out social support, financial planning, or other resources.

Final Thoughts

As the population ages, the cost of aging and growing older in America will continue to rise.

It’s essential to have a realistic look at the cost of living in older ages to ensure that older adults can maintain their quality of life without suffering a financial burden.

The cost of healthcare, income and retirement, housing and transportation, and community and social support are all significant factors that affect the cost of aging.

Family members and family caregivers should also be aware of the costs to help older adults plan for their future.

It’s essential to note that the cost of aging and growing older in America is not solely a financial issue.

Good health outcomes and quality of life are also critical considerations. As such, it’s crucial to address the social determinants of health to ensure that older adults can live their lives to the fullest.

By understanding the cost of aging, policymakers and individuals alike can take steps to improve the lives of older adults and ensure that they can age with dignity and grace.

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