Retirement Retired Life

Here's How Much the Average Retiree Spends Per Month on Housing

Housing remains one of the biggest retirement expenses, and even retirees without a mortgage may still face higher monthly costs than expected.

By Kristin Hitchcock , Edited by Calista Headrick

Updated March 28, 2026

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Housing does not magically get cheap once you stop working. In fact, for many older Americans, it remains one of the biggest line items in the budget long after the mortgage is gone. Between property taxes, insurance, utilities, repairs, and rent for those who do not own, housing can keep taking a larger bite out of retirement income than many people expect.

That is exactly why it helps to look closely at this number if you want to avoid wasting your retirement savings.

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The average retiree spends about $1,861 per month on housing

According to the Federal Reserve Bank of St. Louis' FRED tables, which draw from the Bureau of Labor Statistics Consumer Expenditure Survey, households headed by someone ages 65 to 74 spent an average of $22,329 per year on housing in 2024. That works out to about $1,861 per month. Housing was the single largest spending category for this age group, ahead of transportation, food, and health care.

That total includes much more than just a mortgage or rent. It rolls in shelter, utilities, phone service, household operations, furnishings, repairs, insurance, and property taxes. So even retirees who have paid off their homes may still face a meaningful monthly housing bill.

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Housing spending was slightly higher than the year before

The same FRED table shows that housing spending for ages 65 to 74 was $22,216 in the preceding period and $22,329 in 2024, an increase of $113 per year, or about $9 more per month. That is not a dramatic jump, but it does show that housing costs are still drifting upward rather than easing meaningfully for retirees.

Some pieces of housing spending moved more than others. Property taxes rose to $3,003 from $2,891, while utilities, fuels, and public services increased to $4,653 from $4,491. Mortgage interest and charges, by contrast, fell to $1,975 from $2,223, which likely helped offset bigger increases elsewhere.

Why housing takes such a large share of retirement spending

One big reason is simple: retirees still need a place to live, and owning a home does not eliminate ongoing housing expenses. The BLS has noted that housing remains high for older households partly because most people in these age groups are homeowners, and even mortgage-free owners still pay for taxes, insurance, maintenance, and utilities.

There is also the reality that many older adults are staying in their homes longer. That can be financially smart in some cases, but older homes often come with repair costs, upkeep, and accessibility upgrades. Census Bureau reporting has also found that relatively few U.S. homes are "aging-ready," which can leave older households paying to adapt their homes as they age.

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Retirees without a mortgage still are not "done" paying for housing

A paid-off house can reduce monthly expenses, but it rarely wipes them out. In the FRED data for ages 65 to 74, property taxes alone average $3,003 per year, while maintenance, repairs, insurance, and other owned-dwelling expenses averaged $3,558. Utilities, fuels, and public services added another $4,653.

That helps explain why some retirees feel financially squeezed even after reaching a major milestone like paying off the mortgage. The housing payment may be gone, but the house still keeps generating bills. In practice, the monthly cost of staying put can be much higher than many people planned for during their working years.

How retirees might lower housing costs in retirement

Luckily, there are some ways retirees might be able to lower their housing costs:

Downsize to a smaller home: A smaller house or condo could reduce utilities, maintenance, repairs, and possibly property taxes. For some retirees, that may free up cash flow without a major lifestyle change.
Relocate to a lower-cost area: Moving to a less expensive town or state could lower property taxes, insurance, and utility costs. This can make a bigger difference than smaller budget cuts.
Reevaluate insurance and property taxes: Shopping around for homeowners, condo, and renters insurance could uncover savings. Some retirees also may qualify for senior tax breaks, homestead exemptions, or lower assessments.
Cut utility costs where possible: Utilities are a major housing expense for retirees. Small changes like sealing drafts, upgrading appliances, or adjusting thermostat settings could help trim monthly bills.

Bottom line

Housing remains one of the biggest expenses in retirement, even for people who no longer have a mortgage. That is why reviewing housing costs can be a smart money move for seniors. A smaller home, lower-cost location, reduced utility use, or tax relief programs might not solve every budget problem, but each one could help create more breathing room in retirement.

Housing costs can also affect access to certain forms of assistance. Keeping expenses manageable may make it easier to stretch income and preserve savings for health care, emergencies, and other overlooked senior benefits that become more important later in retirement.

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