Mortgage Debt in Retirement: A Growing Concern for American Boomers

For many Americans, owning a home free and clear was once a major financial milestone in retirement. However, new research from Visa shows that this is no longer the case for a growing number of older Americans.

According to the research, 41% of homeowners between ages 65 and 79 still have mortgage debt as of 2022. This is a significant increase from previous years, with 31% of homeowners age 80 and older still making mortgage payments, up from just 3% in 1989.

The research also found that baby boomers collectively carry more than $4 trillion in debt, including credit cards, auto loans, personal loans, and borrowing tied to investment accounts. This has a significant impact on the wealth they can pass on to their heirs, with Visa estimating that only about $36 trillion will ultimately be passed on after accounting for debt, retirement spending, taxes, and charitable giving.

This means that many people expecting a huge wave of inheritance may be disappointed. The reality is much smaller once everyday financial obligations enter the picture.