It’s no surprise that many older adults are struggling financially. Between the Great Recession, which wiped out many of our savings, rising medical costs and low interest rates, baby boomers are in a tricky spot, financially speaking.
Not only are our savings, on average, well below what they would need to be to give us comfort and security in retirement, but, many boomers are still deeply in debt.
According to Forbes, 40% of older adults still have at least $5,000 in credit card debt. 22% have credit card debt of over $10,000. For many, the amount that they owe is greater than the amount in their bank account.
With so many of struggling financially, perhaps it’s no surprise that bankruptcy rates have been rising rapidly amount people of our generation.
Specifically, according AARP, the rate at which older adults file for bankruptcy has more than doubled since 1991.
Of course, declaring bankruptcy can be a traumatic experience for individuals. It can also cut off financial options that may be crucial when unexpected emergencies occur (such as medical costs).
At the same time, there is also a larger sociological problem here. After a certain age, many of us feel that there is no reason to pay off our debts any more. Or, we may simply not be able to afford to pay off our debts once our careers end.
Either way, with 10,000 baby boomers reaching retirement age every single day, this is a problem that isn’t going to go away… if anything, we will likely see the number of bankruptcies among our neighbors increasing in the years ahead.
The decision regarding whether to declare bankruptcy is a personal one and it should only be made in collaboration with a financial professional. That said, if you are still looking for ways to pay down your debt, I encourage you to read the following Sixty and Me articles. I hope you find them useful!
70% of Older Adults Still Have Debt. Here’s What We Can Do About it
How to Pay Off Debt in Retirement by Negotiating with Your Creditors
The First Step to Getting Out of Debt After 60 is Understanding the Problem
Why do you think that bankruptcies among older adults are increasing? What advice would you give to a friend who is struggling with debt? Let’s have a chat!
Editor’s note: none of the information in this article should be considered financial advice. Please consult with a financial professional before making any decisions regarding your financial future.