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The growing number of senior citizen bankruptcies

On Behalf of | Nov 14, 2022 | Bankruptcy |

Bankruptcy can become an option for anybody who is drowning in debt. Young people who irresponsibly wrack up credit card debt and other balances can suddenly find themselves in need of relief. Married couples who are behind in their house payments due to a layoff of a spouse take action to keep a roof over their heads.

Simply put, no one is too old to consider the option of Chapter 7 or Chapter 13 bankruptcy.

An increasing number of senior filings

Senior citizens are not immune to severe financial problems. While they used to account for only eight percent of bankruptcies, those who are 55 and older pursuing relief doubled in the last 15 years, representing 20 percent of Chapter 7 and Chapter 13 filings.

Some continue to deal with money problems from a divorce. Others don’t want to saddle their heirs with in the future. They need help in wiping out or reorganizing their debts, particularly medical bills and credit card balances.

For seniors who no longer own a house or have significant equity, Chapter 7 seems to be the path to pursue. Conversely, elderly homeowners with substantial equity may need to use that money to pay off creditors. The only other option is to put the house up for sale.

Credit card debt is also a problem, particularly for seniors on a fixed income. Far too many did not prepare or plan ahead to ensure financial stability for the remaining years of their lives.

In the end, bankruptcy is, at best, a last resort to resolve out-of-control financial problems. The proverbial fresh start can make the remaining years of life more enjoyable and stress-free.