Wednesday, August 15, 2007

Bankruptcies are Increasing Faster Among Americans 55 and Over Than in Any Other Age Group

"For many retirees, Social Security and pension income are simply no longer sufficient to meet day-to-day needs," the National Consumer Law Center stated in a July 2006 report. "In rapidly increasing numbers, elders are using credit to pay for necessities like groceries, drugs and urgent house repairs."

The report noted that credit card debt among people 65 and over increased nearly 90 percent, to more than $4,000, from 1992 to 2001. Those from 65 to 69 saw a whopping 217 percent increase, to an average of $5,844 in debt.

Credit is not only easy, it is often required, setting some older people up for problems.

"A (health care) provider these days won't talk to you unless you provide a credit card," said Teresa Sullivan, a sociology professor and researcher at the University of Michigan, who worked with Thorne on the groundbreaking 2001 study. "For emergency rooms, doctors -- the card has become a kind of universal guarantee."
Once they have credit debt, older people find it hard to break out of the cycle of high interest rate payments and fees that can exceed the original debt.

As in Broadbent's case, medical costs are a growing problem for the older population. U.S. Department of Health and Human Services statistics show that older people spent, on average, $3,526 on out-of-pocket health costs in 2002, a 45 percent increase from a decade earlier.

Those 65 and over are typically covered by Medicare, the federal health program. Though they still have out-of-pocket costs, those pale in comparison with the expenses faced by the 6 million-plus who are ages 50 to 64 and are uninsured, according to AARP statistics.

Thanks to Felicia Curran at for the heads up on this disturbing development !

No comments: