Over the past two decades, bankruptcy rates have surged, particularly for older Americans. They’re now declaring bankruptcy at a higher rate than they did before, and that has many implications when it comes to retirement planning, estate planning and the other financial issues that this age group generally has to consider.
Specifically, here are two statistics from a study on bankruptcy filings in the United States:
- Between 1991 and 2016, people who ranged in age from 55 to 64 years old saw a 66% increase in the number of bankruptcy filings.
- During that same time period, those from 65 to 74 years old saw an even larger increase of a massive 204%.
Why is this happening? The study noted that one of the top reasons was that medical care was getting so expensive. Modern medicine can do a lot to improve people’s quality of life or to keep them alive in general, but it’s very expensive. A lot of these people made wise financial decisions for their entire lives, but then they ran into health problems as they grew older. Those issues consumed what savings they had and left them with massive amounts of outstanding debt, which they had to get rid of or reorganize by using bankruptcy.
It will be interesting to see the impact this has going forward. How many people are expecting an inheritance from their parents, for instance, only to find that all of their assets went to paying off medical bills? How many will find that their parents still had outstanding debt?
As these trends continue, it’s clear that all Americans need to know exactly what legal options they have for debt relief. If you’re drowning in debt, it’s time to seek assistance and think about filing for bankruptcy.