We call it the “golden years,” but for many their retirement years are not quite as shiny as they expected. In recent years a lot more seniors are filing for bankruptcy. According to researchers from four U.S. universities, 1 in 7 people who filed for bankruptcy is 65 or older. This data indicates almost five times as many retirees are filing bankruptcy in comparison to 25 years ago.
The study concluded that there were specific societal trends and changes that were causing a drastic increase in the senior bankruptcy filings:
- Rising Healthcare Costs
- Increase of the Age at Which Retirees are Eligible for Full Social Security Benefits
- Replacing Pensions with Workplace Retirement Plans like 401(k)s
Seniors themselves cited their reasons for filing with the top four reasons for filing bankruptcy as a senior falling in line with the conclusions made in the study.
4 Things Pushing Seniors Towards Bankruptcy:
- Stress from Dealing with Debt Collectors: The automatic stay goes into effect immediately upon filing for bankruptcy requiring creditors to halt all collection activities immediately.
- A decline in Income/Financial Struggles: A significant amount of seniors do not have enough income to cover their expenses once they retire.
- Medical Expenses: With high deductibles and copays now the norm for “good” health insurance coverage, any medical treatment can be financially devastating; particularly long-term care.
- Missing Work Due to Medical Issues: Another issue that is more prominent amongst the older demographic is missing work due to poor health or medical reasons. Significant amounts of missed work results in a loss of income or opportunities for promotion, bonuses, etc. in the workplace.
Without significant government policy changes, the trend of increasing numbers of seniors filing bankruptcy is likely to continue.
If you are struggling through your retirement years or if you are facing your retirement years knowing your income won’t be enough, get in touch with an experienced Tennessee and Georgia bankruptcy attorney at the office of Kenneth C. Rannick P.C. today.