The Not-So-Golden Years

            According to a recent FOX news report, retirement these days doesn’t mean a time of leisure with no financial worries. An increasing number of Americans aged 65 and older are declaring bankruptcy, according to a recent study by John Pottow, professor of law at the University of Michigan Law School and an internationally recognized expert in the field of bankruptcy and commercial law. According to Pottow, those aged 65 and older represented seven percent of bankruptcy filers in 2007, an astonishing jump from 1991. He says they are the “fastest-growing age demographic."
            According to Pottow, the reason is mainly credit card debt.  Two-thirds of Americans who filed for bankruptcy said credit card debt was the cause of their financial problems, according to Pottow’s research. Filers aged 65 and over had more credit card debt compared to younger filers. “They’re using credit cards as a maladaptive coping mechanism,” Pottow says.

            Many seniors are attempting to live off a fixed income such as social security or a small pension. Many who thought they could live on their social security and savings are finding their medical expenses are significantly more than they anticipated. Still others have found the value of their investment portfolios drop because of the current economic crisis. Seniors are increasingly turning to credit cards as a means to supplement their income. 

            While filing for bankruptcy is very stressful for anyone, the jump in the number of seniors declaring bankruptcy is particularly distressing. I find it sad that so many are finding themselves in over their heads in what was supposed to have been their “golden years ."

Test your knowledge of bankruptcy here.

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Please vote in this week’s poll “Have any seniors in your family been stressed by severe financial problems?” The poll is located at the bottom of the right column.

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