Bankruptcy can relieve debtors from liability for some unsecured debts and prevent creditors from taking collection actions. According to a July 2009 Bloomberg report, there were 675,351 consumer bankruptcy filings in the first half of 2009, a 36.5 percent increase over 2008 numbers.
Older Americans have experienced the sharpest increase in bankruptcy filings, jumping from 8.2 percent of debtors in 1991 to 22.3 percent in 2007, according to a study by the Consumer Bankruptcy Project, as reported by The Associated Press. The study found that Americans 55 and older accounted for approximately 8 percent of bankruptcies filed in 2001. But by 2007 Americans 55 and older represented 22 percent of bankruptcy filings.
The increase was also found by the Public Policy Institute of the AARP (American Association of Retired Persons). Harvard Law Professor Elizabeth Warren, author of the study, also found that the median age for bankruptcy filers had increased from 36.5 years old in 1991 to 43 years old in 2007. During a recession, living expenses continue to rise, and inflation sets in, yet older adults often do not have a way to dramatically increase their income to keep pace. Thus, many have turned to bankruptcy, according to The Sader Law Firm, a Kansas City bankruptcy lawyer firm who is certified in Consumer Bankruptcy Law by the American Board of Certification.
Among debtors aged 50-65, more than two-thirds cite either medical or job problems as the reason for bankruptcy, according to Elizabeth Warren and Leo Gottlieb, in a report on consumer bankruptcy for Harvard Law School.
Those 65 and over are typically covered by Medicare, the federal health program, but they still have out-of-pocket costs. And those costs pale in comparison with the expenses faced by the 6 million-plus who are age 50 to 64 and are uninsured, according to the AARP.
“For many retirees, Social Security and pension income are simply no longer sufficient to meet day-to-day needs,” the National Consumer Law Center stated in a July 2006 report. “In rapidly increasing numbers, elders are using credit to pay for necessities like groceries, drugs and urgent house repairs.”
Higher reliance on credit cards and other forms of debt during the recession have caused many to contact bankruptcy attorneys for relief, and older Americans are among the most currently in need of relief. Contact experienced Kansas City bankruptcy attorney firm The Sader Law Firm for assistance with your overwhelming debt.