So it’s no surprise that demographics like college grads are up to their necks with student loan debt, as the average student graduates their senior year with something like $25,000 in loans. But what was news to me is that seniors are becoming more buried by debt lately, from credit cards to student loans to mortgages.
According to an article in MSN Money by Steve Yoder, the Employee Benefit Research Institute’s 2013 survey results revealed that the amount of households with credit card debt that are headed by a consumer who is 75 years old or older jumped from 11% back in 1998 to a whopping 22% in 2010. On top of that, a study done in 2011 by the University of Michigan Law School showed that consumers who are 65 years old and older are actually the fastest-growing demographic of people in the U.S. to be filing bankruptcy, carrying 50% more credit card debt that consumers younger than them.
If it sounds like a lot of seniors and retirees are racking up debt, well it’s because they are. And don’t be so naïve as to think that your kids won’t inherit any of it when you’re gone, either, because there are many laws that enable banks and even the IRS to come after kids as beneficiaries of gifts and as co-signers to settle the debt.
At GreyWingFinancial.com, we encourage readers to chip away at debt as dutifully as possible. Paying off your debt will not only weigh less on your mind, giving you peace during your golden years, but it will ensure that it never has to weigh on the shoulders of your offspring. Our strongest and best recommendation for paying down debt is, quite simply, budgeting. Monthly budgets are essential to determine where you can cut costs and where you can afford to save, putting the savings towards paying down debt. And, for goodness sake, stop swiping the plastic if you can’t pay it off in full every month!