It is often assumed that by the time a person retires, they may be passed the point in life where they would be under the pressures of serious debt. That, however, is not always true. Many seniors in New Jersey and around the country continue to experience serious financial challenges. A new report has even found that these challenges are forcing a large number of people over the age of 65 to file for bankruptcy.
As reported by Insider, the report was based on data from the Consumer Bankruptcy Project and found that the rate of personal bankruptcy filings among people 65 and older has increased by as much as 300% since 1991. It did not break that out by the type of bankruptcy, Chapter 7 or Chapter 13. Consumers in this age group are also prone to carry levels of debt that exceed those of their predecessors.
The reasons that so many baby boomers are seeking debt relief through bankruptcy are many. One is a potential downfall of a positive factor. Today’s longer lifespans mean money has to go farther and it may not always be able to do so. Increased medical spending due to out-of-pocket costs was another contributing element to the high levels of debt. The replacement of many workers’ pensions with 401K plans was also cited.
Many seniors have also incurred student loan debt either for their own education or for the education of their children and even grandchildren. The study reviewed almost 900 personal bankruptcy filings among consumers between the ages of 19 and 92.