Half of California’s Middle-Income Seniors Will Struggle to Pay for Housing and Care in a Decade, Even If They Sell Their Homes

California’s Middle-Income Senior Population Projected to Grow to 1.6M by 2033

CHICAGO, October 5, 2022 –Nearly 90 percent of California’s middle-income seniors aged 75 and older are projected to struggle with covering the cost of private assisted living over the next decade, unless they sell their homes and use the equity. Even if they sell their homes, roughly half are still unlikely to afford long-term care and housing by 2033.

Researchers from NORC at the University of Chicago say these California seniors will not have the means to pay for private senior care but are also unlikely to qualify for Medicaid, the means-tested federal-state partnership that covers long-term care expenses.

With support from The SCAN Foundation and West Health, this new analysis from NORC forecasted how the size, demographics, health status, and financial resources of California’s middle-income seniors will change by 2033. It found that the state’s middle-income senior population will increase by 60 percent and will be much more diverse, with people of color comprising 47 percent of this middle-income market. The study also found that most of California’s middle-income seniors are likely to develop multiple chronic conditions and mobility limitations in the next decade, making it challenging for them to live independently.

California's Middle-Income Seniors Will be More Diverse in 2033, with People of Color Making up 47% of the population

Building upon the groundbreaking “Forgotten Middle” study and its subsequent update, researchers at NORC recalibrated a nationally representative forecast of the 2033 middle-market population to produce estimates reflective of future Californians. The analysis revealed several key findings about the potential unmet needs of California’s middle-income seniors, including:

  • The middle-income senior population in California will increase to 1.6 million in 2033. Notably, the number of middle-income seniors aged 85 and older in the state is expected to double, from 230,000 to 463,000.
  • By 2033, 58 percent of California’s middle-income seniors will be unmarried, and 43 percent may not have children living within 10 miles.
  • One in five middle-income seniors in California will have cognitive impairments or high needs. A majority will have three or more chronic conditions and mobility limitations.

“California’s older adults face a more expensive future for senior housing and long-term care services than the rest of the country. Meanwhile, they are less likely to have children living close by, which means they may need to pay for additional caregiving support,” said Caroline Pearson, senior vice president at NORC. “By 2033, nine out of 10 middle-income adults may be unable to pay for assisted living, if they need it.”

Without selling their homes, 1.4 million future middle-income seniors (89 percent) in California will have less than $75,000 in income and annuitized assets – the average amount required to pay for medical expenses and assisted living rent. Even if they sell their  homes, over 780,000 (49 percent) still will not have sufficient resources to cover those costs.

Excluding Home Equity 89% of California's Middle-INcome Seniors Will Have Insuffienct Resoruces for Private-Pay Assisted Living


This analysis relies on the Health and Retirement Study (HRS), using 2018 as a base year. Researchers at NORC examined individuals who were aged 60 and older in 2018 since they will be aged 75 or older in 2033. For each of these individuals in the sample, the researchers modeled the probability of living to 2033 for inclusion in the future senior cohort.

The researchers then examined the time-invariate demographic attributes of this group, such as gender, race, and education. They estimated people’s health, cognitive function, and mobility status assuming the same rates of these conditions that exist in the 2018 population, for each demographic subgroup.

The researchers also modeled these individuals’ future financial resources, starting from their actual income and assets in 2018. They grew these assets based on the historical rate of change for each type of financial resource and annuitized assets across individual’s life expectancy.

NORC researchers then recalibrated the nationally representative forecast of the 2033 middle-market population and their financial resources to produce estimates representative of future Californians. The re-weighting process utilized benchmarks derived from the American Community Survey (ACS), California Health Interview Survey (CHIS), and the National Study of Long-Term Care Providers to generate California estimates. The benchmarks selected for reweighting included: sex, race, age category, education, partnered status, children living in residence, working status, income, assisted living or nursing home residency, self-reported health status, high blood pressure, diabetes, and smoking status.

The researchers analyzed financial resources at an individual level instead of a household basis, as is common. By characterizing resources at an individual level, the research is better able to account for differences in life expectancy and health needs of spouses. This also enables us to compare resources against annual housing and care costs.

In addition to analyzing California’s middle-market using Forgotten Middle income thresholds (214% FPL to 832% FPL), researchers also examined California’s “near dual” population (139% FPL to 400% FPL). This allowed NORC to better assess the demographics and health needs of the population at risk of spending down to Medicaid eligibility.

The analysis’ measure of financial resources includes income streams (i.e., Social Security) and annuitized assets (i.e., retirement savings or mutual funds). For some seniors, adult children may make financial contributions to support their senior housing and care, though this analysis does not assume any financial support from adult children. The researchers include information about housing equity but hold this separately, as some individuals may be reluctant to sell their home or may have a spouse who continues to live in the home. Additionally, some seniors may want to retain their home as a “nest egg” to protect against outliving their assets or having a catastrophic health event.

Read the full methodology here.

About NORC at the University of Chicago
NORC at the University of Chicago conducts research and analysis that decision-makers trust. As a nonpartisan research organization and a pioneer in measuring and understanding the world, we have studied almost every aspect of the human experience and every major news event for more than eight decades. Today, we partner with government, corporate, and nonprofit clients around the world to provide the objectivity and expertise necessary to inform the critical decisions facing society.

For more information, contact Eric Young at NORC at young-eric@norc.org or (703) 217-6814 (cell).



About The SCAN Foundation

The SCAN Foundation is an independent public charity devoted to transforming care for older adults in ways that preserve dignity and encourage independence. Our mission is to advance a coordinated and easily navigated system of high-quality services for older adults so they can access health and supportive services of their choosing to meet their needs. Across all the work we fund, we value projects that are bold, catalytic, and impact-oriented.



Contact: For more information, contact Mari Nicholson at The SCAN Foundation at mnicholson@thescanfoundation.org or (562) 362-2067 (cell).

About West Health

Solely funded by philanthropists Gary and Mary West, West Health is a family of nonprofit and nonpartisan organizations, including the Gary and Mary West Foundation and Gary and Mary West Health Institute in San Diego and the Gary and Mary West Health Policy Center in Washington, D.C. West Health is dedicated to lowering healthcare costs to enable seniors to successfully age in places with access to high-quality, affordable health and support services that preserve and protect their dignity, quality of life and independence. Learn More at www.westhealth.org