Musical training can counteract age-related decline in speech perception in noisy environments. However, it remains unclear whether older non-musicians and musicians rely on functional compensation or functional preservation to counteract the adverse effects of aging. This study utilized resting-state functional connectivity (FC) to investigate functional lateralization, a fundamental organization feature, in older musicians (OM), older non-musicians (ONM), and young non-musicians (YNM). Results showed that OM outperformed ONM and achieved comparable performance to YNM in speech-in-noise and speech-in-speech tasks. ONM exhibited reduced lateralization than YNM in lateralization index (LI) of intrahemispheric FC (LI_intra) in the cingulo-opercular network (CON) and LI of interhemispheric heterotopic FC (LI_he) in the language network (LAN). Conversely, OM showed higher neural alignment to YNM (i.e., a more similar lateralization pattern) compared to ONM in CON, LAN, frontoparietal network (FPN), dorsal attention network (DAN), and default mode network (DMN), indicating preservation of youth-like lateralization patterns due to musical experience. Furthermore, in ONM, stronger left-lateralized and lower alignment-to-young of LI_intra in the somatomotor network (SMN) and DAN and LI_he in DMN correlated with better speech performance, indicating a functional compensation mechanism. In contrast, stronger right-lateralized LI_intra in FPN and DAN and higher alignment-to-young of LI_he in LAN correlated with better performance in OM, suggesting a functional preservation mechanism. These findings highlight the differential roles of functional preservation and compensation of lateralization in speech perception in noise among elderly individuals with and without musical expertise, offering insights into successful aging theories from the lens of functional lateralization and speech perception.