An increased number of seniors have "turned to credit cards and home equity to pay medical bills" at a time when "more employers are cutting back on retiree medical and pension benefits," USA Today reports. According to USA Today, "many seniors live on fixed incomes," and an "illness or disability can plunge them into crushing debt."
Among households ages 65 and older, the average amount of credit card debt more than doubled between 1992 and 2004 to $4,907, according to New York-based think tank Demos.
In addition, bankruptcy filings in recent years have increased among seniors at a higher rate than among any other age group, although seniors accounted for only 5% of filings as of 2001, according to research conducted by Deborah Thorne, an assistant professor at Ohio University; Elizabeth Warren, a professor at Harvard Law School; and Teresa Sullivan, a former professor at the University of Texas-Austin.
Sally Hurme of AARP said many seniors have "debt loads that their parents would not have considered," adding, "This does not bode well for financial health."
In addition, experts predict that the "debt problems are likely to swell" as the 79 million baby boomers begin to retire, USA Today reports.
Mary Alice Jackson, an elder law attorney in Florida, said, "We're at the tip of the iceberg. This generation will have no problem at all racking up debt and worrying about it later" (Chu, USA Today, 1/23).