A study from the Consumer Bankruptcy Project has found that California residents and other Americans who are 65 and older filed for bankruptcy at a higher rate in 2016 compared to 1991. The rate was more than 200 percent higher for people between the ages of 65 and 74 and more than triple for individuals 75 and older. This is partially because there are more Americans in this age range today compared to past decades.
The study found that by 2050, there will be 88 million Americans who will be age 65 or older. Its authors contend that the bankruptcy system could be overwhelmed by retirees filing if recent trends continue. However, it is worth noting that older Americans are filing for bankruptcy at a rate lower than other age groups. Of those who filed between 2013 and 2016, only 3.3 percent were over the age of 75.
According to the study, a combination of inadequate savings and health issues made it harder to obtain financial security in retirement. Of those who took part in the study, 62 percent said medical issues led to their bankruptcy. Additionally, 40 percent said that they had to take time off from work because of medical issues. The transition from pensions to 401(k) savings plans was also cited as a reason as to why more retirees faced financial problems.
Individuals who struggle to keep up with their debts may benefit by filing for bankruptcy protection protection. It may be possible to retain assets and put an end to creditor collection phone calls or letters. There are several eligibility and other requirements that an attorney can outline.
