It’s sad but true — homelessness is on the rise among adults ages 50 and older. With the Social Security Administration (SSA) being strapped on resources, as more and more retiring baby boomers have turned 65, many are facing a dwindling supply of their primary source of income.
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The complicated issue of unhoused people in the boomer generation is due to many factors, but the fact remains that they have no safety net or retirement funds to fall back on when a financial emergency strikes.
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Quick Take: Why Are Some Boomers Retiring Homeless?
Individuals with late-onset homelessness often have lived in poverty throughout their adult lives despite long work histories, albeit in low-paying jobs. Many boomers approaching retirement age have suffered setbacks such as job loss, illness, divorce or the death of a spouse, partner or parent. It’s never easy to save for retirement, but all of these make it even more difficult.
Here are some key reasons boomers are vulnerable to a financial crisis:
Shortage of affordable rental housing
Competitive job markets
Financial disadvantages stemming from the economy, not to mention the Great Recession and its effects on homeownership
Health challenges
The situation is not without hope though, as you still have options for shoring up your finances and working within your means to safeguard your retirement. Here are six ways to help prevent a housing crisis in your retirement.
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Assess How Much You Have and How Much You’ll Need in Retirement
How much you’ll need in retirement varies based on your location, lifestyle and how long you continue to work. Many financial experts recommend saving about 80% to 90% of your pre-retirement income, or 10 to 12 times your final salary.
Work at Least Until Age 70
For each month you stay in the labor force and work past your full retirement age, you earn delayed-retirement credits that can increase your Social Security benefits by up to 30%. You reach the maximum benefit at age 70. In the meantime, your income won’t reduce your Social Security benefit as long as you’ve reached full retirement age.
In 2025, by waiting to claim Social Security past age 67, for example, you’ll get up to the maximum Social Security benefit of $5,108 per month if you delay claiming until age 70 as opposed to getting $4,018 if you start collecting at 66 or 67. In addition to increasing your Social Security benefit, the extra working years will replace any lower-earning and $0-earning years in your work history used for your benefit calculation.
Talk to Your Partner About Your Financial Future
Make sure you are familiar with your spouse’s or partner’s savings to avoid any financial shocks should the unexpected happen. It’s important to be on the same page so you can work together to make the best use of your resources.
Save What You Can
Any little bit you can sock away will supplement your retirement income and might keep your head above water in the event of a financial emergency. Start with emergency savings, then move up to an individual retirement account (IRA) or your employer’s 401(k) — especially if your employer matches contributions.
In either case, you contribute before-tax earnings, which grow tax-free until you withdraw them in retirement. The IRS limits how much you can contribute to an IRA and 401(k) each year (for 2025 it is $23,500), but investors ages 50 and up get a special perk — the ability to make catch-up contributions of $1,000 to an IRA or $7,500 to a 401(k).
Avoid Debt or Make Paying It Off a Priority
Boomers should diligently pay down debt and avoid using credit cards unless they can pay off the balance each month. Also, avoid shouldering debt for your grown and almost-grown children. They have time to recover from financial setbacks, whereas you don’t as much.
Live Beneath Your Means by Downsizing Your Home
If you own, you might consider downsizing to a smaller, less-expensive home and saving the sale proceeds in a retirement account. If you own the home outright, you have another option — a home-equity conversion mortgage or reverse mortgage, which pays you cash against the equity in your home.
Why Aren’t Boomers Saving Enough for Retirement?
A large percentage of baby boomers — people born between 1946 and 1964 — are approaching retirement with no retirement savings. So why aren’t baby boomers saving enough or, in some cases, at all? For many, it’s a lack of opportunity or the general failure to account for increasing life expectancy and the medical care that goes along with it.
In addition, boomers may have unrealistic expectations about their retirement finances. For example, many believe Social Security will cover all or most of their expenses in retirement. In fact, it replaces just 40% of pre-retirement income on average. Yet, about 20% of retired boomers rely solely on Social Security and other government programs for retirement income.
Final Take To GO: Preparing for Retirement
The best time to create a retirement strategy is years before you retire, but no matter how close you are, it’s never too late to come up with a plan. Creating a retirement budget that accounts for realistic income and expenses is a good first step and emergency savings is a vital part of that budget.
From there, delaying retirement while you pay off debt and reduce other expenses will give your bottom line a nice boost and leave you better prepared for the next phase of your life.
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This article originally appeared on GOBankingRates.com: 6 Ways Retiring Boomers Can Keep From Becoming Homeless
