In 2024 the United States reached a historic demographic milestone: the start of what analysts call “Peak 65,” the largest wave of Baby Boomers turning 65. From 2024 through 2027, more than four million Americans will reach that age each year — roughly 11,000 people celebrating their 65th birthday every day. That surge will have wide-ranging implications for retirement finances, the senior living and care industry, and society at large.
The financial picture of the Baby Boomer generation is mixed. On one hand, many Boomers accumulated significant wealth thanks to favorable economic conditions during much of their working lives. On the other hand, a large share of this population approaches retirement with little or no savings, raising concerns about their ability to cover living and long-term care costs.
The wealthy Baby Boomer
Research shows Baby Boomers — those born between 1946 and 1964 — collectively hold more household wealth than any prior generation. Federal Reserve data indicates this cohort has amassed a substantial portion of national household wealth, much of it concentrated in stocks and real estate. Experts attribute this accumulation less to individual financial foresight and more to being fortunate beneficiaries of a period marked by sustained economic growth, accessible housing, and strong equity markets.
As a result, some Boomers are entering retirement with sizable nest eggs and the means to finance high-quality senior living and care options. This prosperity has shaped demand for upscale and luxury senior living communities that cater to affluent retirees who expect premium services and amenities.
The financially insecure Peak 65 Baby Boomer
Yet beneath the headline wealth figures lies a starkly different reality for many older Americans. Multiple surveys and studies show a substantial share of those nearing retirement have little or no retirement savings. A 2023 Credit Karma survey found more than one in four Americans age 59 or older had nothing saved for retirement. A 2024 AARP study produced similar results for people 50 and older.
Further analysis from the Alliance for Lifetime Income (ALI) Retirement Income Institute reveals that over half of the Peak 65 group will have less than $250,000 in assets — counting savings and real estate — and another portion has only modestly more. ALI warns that, given life expectancy and likely expenses, two-thirds of these Peak 65 Boomers will struggle to maintain their pre-retirement lifestyles and may end up relying primarily on Social Security.
Demographic disparities in retirement savings
Retirement savings vary widely across demographic groups. Median savings figures show notable gaps by gender, race, and education level: men generally hold higher median retirement savings than women; white households hold significantly more retirement assets than Hispanic and Black households; and college graduates have far larger median savings than those with only a high school education or less. These disparities underscore that the retirement readiness problem is uneven and that solutions must account for demographic differences.
- The median retirement savings for men is substantially higher than for women.
- White households hold far more median retirement savings than Hispanic and Black households.
- Education level strongly correlates with retirement savings: college graduates typically have much higher median savings than those with only a high school diploma or less.
What about pension plans?
Pensions remain an important source of income for a portion of Peak 65 Boomers. Roughly one-quarter of this cohort report having a defined benefit pension, split roughly evenly between private employers and public-sector or military pensions. However, pension benefits differ by source: median annual government and military pensions tend to be significantly higher than median benefits from private pensions, which remain modest for many retirees.
For those banking on Social Security
Many Boomers count on Social Security as a core component of retirement income. Social Security is designed to replace a portion of pre-retirement earnings, but the average monthly benefit translates to less than $24,000 per year for many retirees — far short of what typical pre-retirement income might require. Surveys show most Baby Boomers expect Social Security to play a major role in their retirement income, and a sizable share plan to depend on it for the vast majority of their needs.
Complicating matters, Social Security faces long-term funding pressures. Actuarial projections have signaled potential trust fund depletion in the coming years unless policy changes are enacted. That prospect adds uncertainty for those who plan to rely heavily on those benefits.
How much money do you need for a secure retirement?
Estimating a comfortable retirement target varies by source and individual circumstances. Some research suggests Baby Boomers believe they need roughly $1.1 million to retire comfortably, while financial advisors commonly recommend saving between $1 million and $1.5 million or aiming for 10 to 12 times final salary. Yet many Boomers have far less saved: median retirement savings figures are often well below those targets.
The gap between recommended savings and actual assets is stark. For many Peak 65 individuals, catching up close to retirement would require impractically large annual savings. Long-term care costs only widen this gap: current averages for assisted living and nursing home care run tens of thousands to more than one hundred thousand dollars per year, and projected increases make future care unaffordable for many without substantial savings.
Systemic and societal solutions are imperative
Long-term care needs can rapidly exhaust retirement savings, and because life expectancy and health needs are uncertain, planning for retirement is inherently complex. The retirement of the Peak 65 Baby Boomers will place heavy demand on housing, health care, and long-term care systems. Given the large share of this cohort that lacks adequate savings, the senior living and care sector — along with policymakers and communities — must develop more affordable, innovative housing and care models that enable people to age with dignity.
At the same time, the industry faces the challenge of meeting the expectations of wealthier Boomers who are willing to pay for higher-end services. Understanding which amenities, services, and lifestyle choices will motivate affluent retirees to spend their savings will shape the financial sustainability of senior living providers.
As Peak 65 unfolds, balancing solutions for those with limited resources and those seeking premium options will be essential. Addressing these divergent needs requires coordinated action across the private sector, government programs, and community-based supports to ensure aging Americans can access safe, affordable, and dignified care.