Sep 9, 2024
After years of inflation and rising costs, some retirees are looking for ways to stretch their retirement budget — especially if they’re single, divorced or widowed and living on a fixed income. And one of those alternatives is finding a “boommate.”
Increasingly, those in the baby boomer generation are seeking roommates for the benefit of sharing the cost of rent or mortgage payments, as well as household expenses, like groceries and bills.
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As 68-year-old Dan Yafet told Bloomberg about his octogenarian roommate, “We don’t throw parties, but it’s a good setup.” The Brooklyn-based empty nester sought his 86-year old roommate Alan Ferber after his son moved out to make use of the extra space and lower his rent.
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This concept of becoming a boommate — a baby boomer who opts for a coliving arrangement — appears to be trending.
To date, close to one million people over the age of 65 have an intergenerational roomate (who they’re not related to) in the U.S., according to Harvard University’s 2023 Housing America’s Older Adults study. And online platforms like HomeShare Online and Nesterly have sprung up to meet this demand, matching older homeowners with potential roommates and young renters with older adults.
While this seems like a resourceful cost-of-living solution, is it right for everyone?
Pros and cons of the boommate arrangement
While two obvious ‘pros’ for a boomer whose retirement savings are stretched thin are splitting costs and saving money, the list goes on. Getting a roommate later in life can perhaps allow a more comfortable daily routine. An elderly homeowner with limited mobility, for example, can benefit from having a younger boommate around to help out with chores (sometimes for reduced rent).
For many, it also serves as a way to combat loneliness and isolation, which has become an epidemic in the United States. A 2023 U.S. Surgeon General advisory warns that a lack of connection can increase the risk of premature death to levels comparable to smoking 15 cigarettes a day. It also increases the risk of dementia in older adults by 50%.
But not everyone feels comfortable sharing their space with a stranger — especially as a fully formed adult. It can take some effort to find a roommate with a similar lifestyle or value system. Does the person smoke? Do they have a pet? Are they allergic to your cat? What are their expectations around having guests over to the house? Fortunately, house-sharing programs can help with this process by vetting potential “boomies” and even doing background checks for safety purposes.
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Housing affordability challenges
While inflation is starting to cool, many retirees on a fixed income are still struggling. A recent AARP survey found that one in five Americans aged 50 and older have no retirement savings and more than half worry they won’t have enough to last into retirement. At the same time, the aforementioned Harvard study found that as of 2021, more than 11 million senior adults are “cost-burdened,” which means more than 30% of their household income goes toward housing.
Even if retirees have paid off their home, it may not make financial sense to downsize during a high interest rate period (and while the price of housing continues to rise). So they’re often left living in a multi-bedroom house with way more space than they need — along with higher bills, property taxes and maintenance costs.
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Some states, however, are better than others. According to a recent analysis by Seniorly, Iowa is the most affordable state in 2024 for retirees, with a median rent of $1,100 and four in five older adults owning their home. Iowa is also one of the most tax friendly states, according to Kiplinger.
For example, if you’re 55-plus, you won’t be taxed on your retirement income, and you’ll benefit from property tax breaks at 65. Other affordable states include New Mexico, Tennessee, Oklahoma and South Dakota.
On the other hand, Seniorly found that California is the most expensive state for retirees, with the fourth-lowest homeownership rate and fourth-highest median rent in the country at $2,795. Other expensive states include New York, Washington, D.C., Massachusetts and Connecticut — largely due to the high cost of housing. In Massachusetts, median rent is even higher than in California, coming in at $3,200.
So for boomers living in these less affordable states, it may be time to start searching for a boommate.
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Vawn Himmelsbach is a veteran journalist who covers tech, business, finance and travel. Her work has been featured in publications such as The Globe and Mail, Toronto Star, National Post, CBC News, Yahoo Finance, MSN, CAA Magazine, Travelweek, Explore Magazine and Consumer Reports.
