Elderly Americans Increasingly Declaring Bankruptcy in Retirement

By Lynnette Khalfani-Cox

Elderly Americans struggling under the weight of credit card debt and medical bills are increasingly resorting to bankruptcy in retirement.

A slew of recent data highlights the problem:

A 2010 study from the University of Michigan Law School, called The Rise in Elder Bankruptcy Filings, found that those 65 and older are the fastest-growing segment of the U.S. population seeking bankruptcy protection
The Washington D.C.-based public policy group Demos reports that Americans 65 and above who carry a balance on their credit cards owe an average of $10,235 — up 26% from 2005.
Older debtors who filed for bankruptcy owed a median $22,562 to credit card companies, the Michigan study showed
“The findings are both striking and ominous,” says John Pottow, author of the University of Michigan study. “While multiple factors, such as health problems and medical debts, contribute to elders’ financial distress, the dominant force appears to be overwhelming burdens related to credit cards.”

Pottow’s study found that elder debtors carry 50% more credit card debt than younger debtors, and seniors cite credit card interest and fees as a reason for their bankruptcy filings 50% more frequently.

Unfortunately, the rise in bankruptcy filings among the elderly isn’t merely a recent phenomenon, or a reflection of the Great Recession. Even before the recession hit, seniors were struggling.

Read the full article here at WalletPop website.

Life Inc: Health care costs for retirees could top $100,000

By Allison Linn, senior business writer

If you want to stay healthy in retirement, you better start saving your pennies.

Even with Medicare coverage, new research finds that 65-year-olds who retire this year could need more than $100,000 to cover co-pays, premiums and other non-reimbursed medical expenses through retirement.

The costs are likely to be higher for women than men because women tend to live longer, according to the report from the Employee Benefit Research Institute.

Of course, everyone has different health care needs, and no one really knows what their health will be like in retirement, so there are a lot of uncertainties. And although the researchers believe that the recently passed health care reform bill will reduce some costs for retirees, they say out of pocket expenses remain substantial.

If you are comfortable with a 50 percent chance of having enough money saved for health expenses, the report finds that a man retiring in 2010 at age 65 with average health care expenditures would need $65,000 in savings. A woman in the same circumstances needs $93,000.

Read more at Lifeinc.todayshow.com