2 Money Problems Boomers Could Face In 2025
Written by
Cindy Lamothe
Edited by
Angela Corry
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A new group of baby boomers is retiring and with it comes some unexpected financial challenges. According to Stewart Willis, president of Asset Preservation Wealth & Tax, Social Security is a big surprise for many — it’s not as straightforward as people think.
“A lot of folks assume it’s completely tax-free, but that’s not always the case. Depending on your income, a portion of your Social Security benefits could actually be taxable. That catches a lot of retirees off guard, especially if they didn’t plan for it.”
On top of that, he said the current economic climate doesn’t make it any easier.
“Rising healthcare costs, inflation, and market ups and downs can really stretch retirement savings thin. Add in the taxes from pulling money out of retirement accounts, and suddenly, your money isn’t going as far as you thought. It just shows how important it is to have a solid plan in place for these kinds of surprises.”
Below are the top money problems boomers could face in 2025 and some ways they can navigate these issues.
The Sandwich Generation
According to experts, boomers may face financial challenges from supporting both adult children and aging parents.
“This is often without realizing how much it impacts their own retirement,” said Willis. “These hidden financial dependencies can quietly drain savings, leaving boomers vulnerable to unexpected expenses like healthcare or long-term care.”
He said many boomers feel obligated to help, especially as younger generations face high living costs, student loans and inflation.
“This support might come in the form of helping with rent, co-signing loans or paying for childcare. While it feels good to give, it can quickly eat into retirement savings, especially when combined with rising costs and market uncertainties.”
Gagandeep Saini, CEO of We Buy Houses in Central Valley, agreed.
“The sandwich generation phenomenon continues to inflict financial stress on Boomers.
“Many of my clients simultaneously support an aging parent and an adult child. One client is now contributing $2,000 a month to help her daughter with college loan payments while also covering assisted living costs for her elderly mother.”
Real Estate
Equally daunting is the issue of real estate, said Saini.
“Many of my Boomer clients planned to realize their retirement by selling their homes, but the maintenance costs and property taxes have eroded their equity.
“Just last month, I worked with a couple whose retirement plans were put on hold because their property taxes rose by $4,000 a year while fixed income levels remained unchanged.”
Advice for Managing These Challenges
According to Heerlein,boomers can handle these challenges by creating boundaries and planning ahead.
“You can set up a family support fund separate from your core retirement savings. When you limit support to what’s in this fund, you can help loved ones without jeopardizing your financial future.”
On another note, you can also create a family financial agreement.
“For example, if you’re helping a child with a home down payment, you could structure it as a loan with repayment terms. This keeps things clear and prevents your generosity from becoming an open-ended financial drain.”
“Saying ‘no’ sometimes is not selfish. Protecting your financial independence ensures you won’t become a burden to your children later. Generosity is valuable, but it should be balanced with your own sustainability.”
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