Average Debt For Seniors
The average debt for people age 65 and older has ballooned up to $50,000 as people on fixed incomes struggle to pay for medical bills, credit card debt and mortgage debt that they’ve carried over into retirement.
Because home equity loans were so easy to get before the 2008 financial crisis, many seniors have borrowed against their homes for home repairs, to help their kids or to put money into the stock market. And one-third of seniors are relying on credit cards to cover the basics of everyday living.
It’s a difficult subject to broach, but many financial planners suggest sitting down and having a frank discussion about your parent’s financial outlook. Do they know where they owe money? Where do they have bank accounts? Have they been hospitalized and socked with overwhelming medical bills?
If your parents allow you to help them with their finances, here are some signs to pay attention to:
All credit options are at or near their limit. If your parents have a number of accounts or cards that are close to the borrowing limit, it may be a sign that making even the minimum payment due on the cards is getting difficult.
They are falling behind on their mortgage. If your parents can’t keep up with mortgage payments, the bank could foreclose on the house and evict your parents.
They are thinking about liquidating retirement accounts to pay creditors. Liquidating assets to pay creditors is never the answer. When you liquidate your retirement accounts as a senior, you’re then forced to rely only on Social Security income.
At that point, it may make financial sense for your parent to meet with a trusted bankruptcy attorney to see what their options are. Retirement and pension accounts are considered safe during bankruptcy proceedings, and any foreclosure can be stopped with an automatic stay.
Call us today at 816-842-6200 to speak with an attorney. Or you can email us and schedule your free consultation.