Local cost of living, financial literacy, and housing hardship at older ages

Objectives The number of older adults struggling to afford housing continues to increase in the United States. Prior research offers limited insight into the individual and spatial contexts through which housing hardship is assessed, particularly neglecting differentials in individual financial literacy and spatially variable cost of living. This study investigates the association between income adjusted for costs of living at the county level and housing hardship in later life, alongside the moderating role of individual financial literacy. Methods The study draws from a unique dataset linking the 2019 cross-section of the Understanding America Study (UAS; n = 2,857; adults aged 50+) and the 2019 Elder Index to capture county-level cost of living specific to older adults. A set of logistic regression models was analyzed to examine the association between income security and housing hardship. Results Results indicate that respondents with higher income adjusted for local costs are less likely to experience housing hardship, and that individual financial literacy reinforces this negative association. Discussion Findings underscore the empowering role of financial literacy in protecting against housing hardship in later life. Findings also show that a location-specific assessment of the cost of living adds to the accuracy of evaluations of housing hardship.