Merrill Lynch Study Finds New Freedoms Help Two-thirds of Retirees Live in the Best Home of Their Lives

Research Reveals Majority of Retirees Likely to Move at Least Once During Retirement, With 30 Percent Moving into Larger Homes

NEW YORK--()--Sixty-five percent of retirees say they are living in the best homes of their lives, according to a new Merrill Lynch study conducted in partnership with Age Wave. With newfound freedom from work and family restrictions, fewer home-related financial concerns, and unprecedented longevity, retirees are more empowered to pursue a home that fits their desired lifestyle and changing priorities. The study, “Home in Retirement: More Freedom, New Choices,” also found that 64 percent of retirees are likely to move at least once during retirement, with 37 percent having already moved and 27 percent anticipating doing so.

“How and where our nation’s aging population chooses to live will have widespread implications on the way homes are designed, the resources people will need, and how communities and businesses nationwide should prepare,” said Andy Sieg, head of Global Wealth and Retirement Solutions for Bank of America Merrill Lynch. “For most retirees, their home is more than just a financial consideration – it’s a place where family and community come together, and can represent treasured memories or independence.”

During the next decade, the number of age 65+ households in the U.S. will increase by nearly 11 million, while growth in the number of households across all other age groups will be less than 2 million1. This tremendous growth among older households is driven by powerful demographic forces, including the massive baby boomer generation now moving into their retirement years and increasing longevity leading to longer retirements.

The new research explores priorities and concerns of retirees and pre-retirees when choosing the type of homes and communities they hope to live in during retirement. Based on a nationally representative survey of more than 3,600 respondents, this landmark study also examines the powerful connections people have to where they live. This research is the latest in a series of studies exploring seven life priorities top of mind for people as they move to and through retirement, including health, home, family, finance, giving, work and leisure.

Home free in retirement

Throughout most of people’s lives, where they reside is determined in large part by work and family responsibilities. However, as people enter their late-50s and 60s they approach and begin to cross what this study reveals as the “Freedom Threshold,” with retirement representing a gateway to unprecedented freedom to choose where to live. The study found that:

  • By age 61, the majority of people feel free to choose where they most want to live.
  • Retirees are more than twice as likely to say they are free to choose where they want to live when compared to pre-retirees (67 percent vs. 30 percent).
  • Four out of five (81 percent) Americans age 65+ are homeowners, and among them, 72 percent have fully paid off their mortgage2.

Retirees on the move: The “downsize surprise”

With new freedom to decide where they want to live, many retirees move to a different home, community or part of the country – with an estimated 4.2 million retirees moving into new homes last year alone3. Retirees’ top motivations for moving include being closer to family (29 percent), reducing home expenses (26 percent), and changes in health (17 percent) or marital status (12 percent).

  • Many people assume they’ll downsize once retired. However, the study found that half (49 percent) of retirees didn’t downsize in their last move – and, in fact, 30 percent moved into larger homes.
  • Retirees’ top reasons for upsizing were to have a home large and comfortable enough for family members to visit (33 percent) or even live with them (20 percent). According to this study, today one out of six retirees (16 percent) has a “boomerang” child who has moved back in with them.
  • Retirees who did downsize (51 percent) cite greater freedom from the financial (64 percent) and maintenance (44 percent) burdens of a larger home among their top reasons.

“With increasing longevity and greater freedom, it’s not surprising that so many retirees are striving to make their homes even more fulfilling,” said David Tyrie, head of Retirement and Personal Wealth Solutions for Bank of America Merrill Lynch. “Achieving your dream home in retirement requires careful forethought and preparation. Whether moving or staying put, it’s important to carefully consider expenses associated with current goals and future priorities, including potential challenges during later years.”

Among retirees who have not and do not plan to move during retirement, the top reasons include their deep emotional connection with their home (54 percent), close proximity to family (48 percent) and friends (31 percent), wanting to remain independent (44 percent), or because they simply can’t afford to move (28 percent). Prior to age 55, more homeowners say the financial value of their home outweighs its emotional value. As people age, however, they become far more likely to say their home’s emotional value is more important – as cited by nearly two out of three people (63 percent) age 75 and older.

Retirement hotspots

Among people age 65+ who moved last year, most (83 percent) chose to remain in the same state; however, roughly one out of six (17 percent) relocated to a different state or part of the country4. Looking ahead, where pre-retirees say they want to live in retirement provides a glimpse of how America may be reshaped in the coming years:

  • Sixty percent of pre-retirees anticipate staying in the same state or region, while the remaining 40 percent see retirement as a chance to try living in a new part of the country.
  • To a large degree, where pre-retirees say they want to stay or move to in retirement mirrors where today’s retirees say they are the happiest. For instance, roughly four out of five pre-retirees living in both the South Atlantic (80 percent) and Pacific (77 percent) regions say they want to continue living there in retirement – two of the top three regions where current retirees give the highest marks among ideal places to live.
  • Among pre-retirees who want to move to a different region once retired, the South Atlantic is the clear winner – with 39 percent saying they would most want to move to that region, followed by the Mountain (25 percent) and Pacific (16 percent) regions.

Home improvements

With age and retirement often come more flexibility, time and financial resources for home improvements. In fact, age 55+ households account for nearly half (47 percent) of all spending on home renovations – about $90 billion annually5. While some retirees modify their home to make it more age-friendly, many also renovate to make it more attractive or versatile. For instance, renovations made by retiree homeowners age 50+ who plan to stay in their home throughout retirement include:

  • Creating a home office (35 percent).
  • Improving curb appeal (34 percent).
  • Upgrading a kitchen (32 percent) or bathroom (29 percent).
  • Adding safety features to accommodate aging (28 percent).
  • Modifying home to live on one floor should there be trouble with stairs (15 percent).

Many retirees are also interested in new technologies that can make their homes more convenient, connected, secure, and easier to maintain. For instance, 80 percent are interested in innovative ways of reducing their home expenses, such as smart thermostats or apps to control appliances, while 58 percent are interested in technologies to help maintain their home, such as cleaning robots or heated driveways.

Health and home in later retirement

Though people enjoy many new freedoms during retirement, health and care can become significant factors when choosing where to live, particularly as people reach their 80s. Among people age 85+, three-quarters (74 percent) have difficulties with daily activities, including housework or getting around the home6. And while the average age of people entering assisted living is 857, people overwhelmingly prefer to receive extended care, if needed, in their own home (85 percent).

“The good news is that there have been tremendous innovations in both technologies and home care services that enable retirees to live independently even if they face health challenges,” said Ken Dychtwald, Ph.D., founder and CEO of Age Wave. “In fact, as more boomers enter their retirement years with more freedom and new choices, we will see a growing number of homes, communities and technology innovations designed to meet people’s needs and desires throughout every stage of retirement.”

To download “Home in Retirement: New Freedoms, More Choices,” visit This report is the fifth in a series of in-depth studies focusing on seven life priorities, as defined through Merrill Lynch Clear®. Merrill Lynch Clear is a pioneering approach designed to connect people’s lives to their finances and help them live their best life in retirement. To explore additional content and resources related to these seven life priorities, visit

1 Joint Center for Housing Studies of Harvard, 2014 (data for 2015 – 2025)
2 Bureau of Labor Statistics, 2013
3 Age Wave calculations based on survey responses and U.S. Census data, 2014
4 Age Wave calculations based on U.S. Census, 2013
5 Joint Center for Housing Studies of Harvard, 2013 and 2014; Age Wave calculations
6 Centers for Medicare and Medicaid Services, 2009
7 “Overview of Assisted Living,” 2009

Age Wave
Age Wave is the nation’s foremost thought leader on population aging and its profound business, social, healthcare, financial, workforce and cultural implications. Under the leadership of founder and CEO Dr. Ken Dychtwald, Age Wave has developed a unique understanding of the body, mind, hopes and demands of new generations of maturing consumers and workers and their expectations, attitudes, hopes, and fears regarding retirement. Since its inception in 1986, the firm has provided breakthrough research, compelling presentations, award-winning communications, education and training systems and results-driven marketing and consulting initiatives to over half the Fortune 500. For more information, please visit Age Wave is not affiliated with Bank of America Corporation.

Merrill Lynch Global Wealth Management
Merrill Lynch Global Wealth Management is a leading provider of comprehensive wealth management and investment services for individuals and businesses globally. With 14,085 Financial Advisors and $2 trillion in client balances as of December 31, 2014, it is among the largest businesses of its kind in the world. Merrill Lynch Global Wealth Management specializes in goals-based wealth management, including planning for retirement, education, legacy, and other life goals through investment, cash and credit management. Within Merrill Lynch Global Wealth Management, the Private Banking and Investment Group focuses on the unique and personalized needs of wealthy individuals, families and their businesses. These clients are served by more than 150 highly specialized Private Wealth Advisor teams, along with experts in areas such as investment management, concentrated stock management and intergenerational wealth transfer strategies. Merrill Lynch Global Wealth Management is part of Bank of America Corporation.

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Reporters May Contact:
Julia Ehrenfeld, Bank of America, 1.646.855.3267