American seniors are struggling to keep up with medical debt
Bankruptcy is rising for older Americans, largely due to an increase in medical debt.
Bankruptcy among American seniors is on the rise. As Forbes reports, those aged 65 and over account for eight percent of all personal bankruptcy filings, up from seven percent in 2008. The main cause of the increasing number of older Americans in bankruptcy is medical debt, which is also the leading cause of bankruptcies overall. Medical expenses are growing rapidly and those worst affected tend to be seniors who are also less equipped to handle an increase in their spending . Furthermore, the medical debt problem is leading to other debt problems for seniors, especially credit card debt.
Medical debt among older Americans
It will come as little surprise to most people that medical debt affects seniors much more often than it does younger Americans. Medical bills can prove substantial and, for older Americans who are in retirement and don’t have a significant income, those bills can prove to be too much. As a result, many older Americans are forced into bankruptcy because of their medical debt. Indeed, medical debt is the leading cause of person bankruptcy and it is why, as mentioned above, the proportion of seniors filing for bankruptcy has risen from seven to eight percent in less than a decade.
Medical debts create other types of debt
In fact, the medical debt problem for seniors may be even more extensive than many people realize. That’s because medical debt can easily create other types of debt problems, particularly credit card debt when medical expenses are charged to credit cards. As USA Today reports, since 2012 middle-income households headed by someone 50 or over have been carrying more credit card debt than households where the head is under 50. Furthermore, half of people over 50 say they have medical debt charged to their credit cards.
This debt burden being carried by seniors is also making life overall more stressful for them, especially in the form of creditor harassment. In fact, as Forbes points out, the Consumer Financial Protection Bureau has found that debt collection was the product or service that consumers over 62 were mostly likely to complain about.
Bankruptcy may offer solutions
Medical debt is often unavoidable and is hardly a reflection of a person making poor financial decisions. It can be difficult for many people who have otherwise been prudent about their spending to realize that they may need to look to bankruptcy to help them get a hold on their debt. However, bankruptcy is not something to be ashamed of. Many types of debt simply cannot be prevented, but bankruptcy may be able to offer some people a chance to get back on their feet. Those who are struggling with debt, including medical and credit card debt, should contact a bankruptcy attorney sooner rather than later in order to see what can be done to get their debt under control.