For some older adults, the idea of passing on the wealth they’ve accumulated over the course of their lives is a given—a sign of a successful life. But for many others, it can feel like an unachievable dream, especially when the attempt to accumulate and transfer wealth competes with the need to use income to support current needs rather than future well-being.
Having sufficient income in the present, therefore, is a necessary precursor to transferring wealth to future generations. But historically, certain groups of people have faced barriers to earning adequate income and building wealth, leading to significant inequities as they age. These barriers are not due to innate ability, but to systemic and institutional challenges. Black households, for example, have a median net worth of $44,900. The median net worth for white households is $285,000, more than six times as much.
People of color, women, LGBTQ+ individuals, and others facing systemic discrimination have had to face a variety of obstacles that impede their ability to build up and pass on wealth as older adults over generations. Factors that can impact lifetime wealth include discrimination in the workforce, higher unemployment, and a higher likelihood of working. This is all when compared to white men, in lower-paid jobs that do not provide access to retirement savings plans. For some, often women, caregiving roles can mean taking more flexible jobs that typically pay less, or spending periods of time out of the workforce, which lowers their lifetime earnings, retirement savings, and ultimately Social Security benefits.
‘In 2023, Social Security alone lifted more than 22 million people out of poverty, including 16.3 million older adults.’
To account for some of these inequities, and to ensure that all people can age with dignity, we have created programs in the United States designed to protect, and even improve, the economic security and well-being of older adults and people with disabilities. These programs, including Social Security and Supplemental Security Income (SSI), Medicare and Medicaid, and federal rental assistance, among others, offer critical support and relief to those who would otherwise not be able to meet their financial needs.
In 2023, Social Security alone lifted more than 22 million people out of poverty, including 16.3 million older adults. It is especially important for people of color and women, who are more likely to earn less over their lifetimes. This is because the program is designed to be progressive, replacing a larger share of earnings for lower-wage workers, while still reflecting each worker’s lifetime contributions.
Meanwhile, as healthcare use increases with age, Medicare serves as the primary health insurance and source of coverage for older adults and people with disabilities. It covers essential services like hospital care, doctor’s visits, and prescriptions, and Medicaid can help fill gaps in coverage and pay for Medicare premiums, as well as support home- and community-based services for Medicare enrollees with limited resources.
The security that programs like Social Security, Medicare and Medicaid provide to low- and middle-income older adults support their ability to make financial decisions that can ultimately allow them to create, hold, and transfer wealth to future generations. For example, people receiving housing vouchers to defray rent costs may be able to put money aside as savings rather than spending all their income (or going into debt) to pay for food, shelter, transportation and other necessities.
While these programs play an important role in helping older adults establish and maintain their economic security, there are many ways they could be improved to do more to help older adults build wealth they can pass on to their family. First, we must continue to invest in these programs and make it easier for people to access the support they need.
Efforts in H.R.1 (“One Big Beautiful Bill Act”), for example, puts health coverage of 15 million people at risk, endangering their current health and undermining the foundation for the next generation to age with dignity. In addition, inadequate funding and deep cuts to vital agencies such as the Social Security Administration make it more difficult for individuals to access the support they need to get the benefits for which they are eligible.
We also can take steps to ensure we do not strip older adults of wealth as they age, in an effort to force them to “pay back” the cost of assistance they receive as part of our country’s social services.
‘Medicaid is alone among public healthcare programs in requiring repayment for services for which the individual was eligible and correctly paid.’
Examples of policies in need of reform include the outdated asset limit under the Supplemental Security Income (SSI) program and Medicaid estate recovery. SSI provides modest monthly income to extremely low-income older adults and people with disabilities and often opens the door to Medicaid eligibility, too. Under current rules, however, a person cannot have more than $2,000 in savings or resources to qualify. This harsh limit forces people to spend down any savings they may accumulate, leaving no cushion for emergencies nor opportunities to build financial stability. ABLE accounts allow people with disabilities that began before age 26 (rising to age 46 in 2026) to save more, but remain largely inaccessible to those without legal or financial representation. The age restrictions also exclude people whose disabilities occur later in life. Proposals to update SSI would allow all SSI recipients to save more, increasing their economic security in the long term, and their ability to pass along wealth to future generations.
Medicaid estate recovery seeks the collection of certain Medicaid payments from beneficiaries’ assets after their death. Medicaid is alone among public healthcare programs in requiring repayment for services for which the individual was eligible and correctly paid. For poor families, the burden of this collection is significant. In communities of color, where a home may be the only significant asset passed down across generations, this harmful policy only exacerbates longstanding systemic barriers, resulting in a disproportionate impact that ultimately deepens housing and health inequities by disrupting a vital pathway for intergenerational wealth accumulation and perpetuating poverty.
Conclusion
The ability to build and pass on wealth should not be a privilege reserved for the few, but a right that reflects the dignity and value of every older adult. Programs like Social Security, SSI, Medicare, Medicaid, and housing assistance have laid an essential foundation by protecting people from poverty and providing stability in later life. Yet inequities persist, and policies such as the SSI asset limit and Medicaid estate recovery threaten to undercut progress by stripping families—especially families of color—of the modest wealth they have worked so hard to secure.
If we want to ensure that all adults can age with dignity, we must strengthen, expand, and defend the social safety net so that it not only safeguards survival but also opens real pathways for economic security across generations. By doing so, we honor the contributions of today’s older adults, fight poverty, and ensure that tomorrow’s families can inherit not just financial resources, but also the promise of dignity, security, and opportunity.
Tracey Gronniger, JD, is managing director, Economic Security, at Justice in Aging in its Washington, DC, office. Denny Chan, JD, is managing director, Equity Advocacy at Justice in Aging and is based in Sacramento, CA.
Photo credit: Shutterstock/kram-9
