1 in 5 Seniors Are 'Millionaires'—But Is It Real Wealth?

Recent data reveals that approximately 20% of seniors in the United States now possess a net worth exceeding $1 million. This surge is largely attributed to significant increases in home equity, driven by escalating property values over the past decade. 

 

In the second quarter of 2025, homeowners aged 62 and older saw their housing wealth reach a record $14.39 trillion, marking a 4% increase from the previous quarter. This growth was primarily due to a 2.9% rise in home values among this demographic. 

 

However, this newfound wealth is predominantly tied up in illiquid assets, particularly real estate. While home equity contributes to net worth, it doesn't provide immediate cash flow for daily expenses or unexpected costs. Selling a home to access this equity can be challenging, especially for retirees who wish to remain in their communities.

 

Moreover, the real estate market's volatility means that home values can fluctuate, potentially diminishing this 'paper wealth.' For seniors relying on their home's value as a financial safety net, a market downturn could pose significant risks.

 

Financial experts advise retirees to develop strategies that convert home equity into accessible funds. Options include reverse mortgages, home equity lines of credit, or downsizing to a less expensive property. These approaches can provide the liquidity needed to cover living expenses without the necessity of selling the home outright.

 

In conclusion, while a significant portion of seniors are now classified as millionaires on paper, it's crucial to recognize the difference between net worth and liquid assets. Ensuring access to funds for daily needs and emergencies is essential for financial security in retirement.

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