How Much Home Equity Upper Middle‑Class Retirees Usually Have by Their Mid‑70s
By their mid-70s, most seniors have paid off most or all of a mortgage they likely took out decades ago. Meanwhile, the price of the home has likely appreciated significantly over several decades.
But how much average equity does this translate to? Here’s a look at what the government data says.
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Home Equity and Household Wealth
The Federal Reserve's Survey of Consumer Finances shows that for those in the 65-74 age bracket, the median household net worth was $409,900 in 2022, dropping to $335,600 for households 75 and older. That’s the most recent year for which Fed data are available and it shows a regular pattern of drawing down wealth and savings once regular paychecks stop.
The Fed's data also break down household wealth by median net housing value, which equates to a home’s value minus any remaining mortgage balance. For upper-middle-income households, that figure sat at $201,000 in 2022.
By way of comparison, households in the top 10% of the income distribution had median housing wealth of $583,000. That’s nearly three times as much, which shows just how much the ultra-wealthy skew “averages” higher.
Regardless of how you slice it, home equity is important to most retirees because the homeownership rate is high among this group. Data from the U.S. Census Bureau shows that householders 65 and older had a 78.6% ownership rate as of the second quarter of 2026.
Location Means Everything
Just as averages can often be misleading, national medians can also hide the enormous spread in values among various regions in the country. According to the Federal Housing Finance Agency, for example, home price appreciation over the past year alone ranged from a 4.4% gain in the East North Central region to a 0.7% decline in the West South Central region.
This can lead to the tale of two retirees. Even if they earned comparable incomes and bought similar homes, one who bought in a coastal metro a few decades ago might have hundreds of thousands of dollars more in equity than one who bought in the Midwest in the 1980s.
Equity Is a Buffer, Not a Paycheck
Equity in a home is not the same thing as cash in a savings account. If you have $200,000 tied up in home equity, you can’t spend it without either selling the house, borrowing against it or both.
For this reason, financial planners typically consider home equity a buffer, not a source of funds. If you have a need for long-term care, a massive medical bill or a sudden loss of income, that’s a time when you might consider tapping your home equity. But if you’re looking for a few extra dollars to cover your monthly grocery bill, your home equity is not the right target.
How Do Reverse Mortgages Play a Role?
According to the Consumer Financial Protection Bureau, a reverse mortgage is simply a loan that accrues fees and interest until it is eventually repaid, usually when the home is sold. Borrowers retain ownership of the home the entire time and they aren't required to make monthly payments. However, they’re still on the hook for property taxes, homeowners insurance and upkeep.
One of the major misconceptions of a reverse mortgage is that it equates to “free money.” But if a homeowner fails to keep up with the costs and expenses attached to the home, there’s a risk that the reverse mortgage can go into default, resulting in the loss of the house.
For this reason, the most common type of reverse mortgage, the federally insured Home Equity Conversion Mortgage, requires HUD-approved counseling before closing so that homeowners understand all the complexities of the product.
The Number That Actually Matters
If you’re an upper middle-class retiree in your mid-70s looking to see where you stand, the number you’re looking for is about $200,000. That’s the amount of home equity that the data says your peers typically have.
But understand that this figure can be misleading based on your ZIP code and that $200,000 in home equity doesn’t equate to liquid funds. If you need to pay for an emergency expense or plan on living off that equity, you’ll have to take the time and expense to access that money.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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