Interestingly, the stereotype we tend to have of folks in debt are the ones who call Dave Ramsey's show for advice.
You know, the fella who wants to know if it is smart to buy an new Ford F-150 ... when he has no current employment?
But that is just a stereotype.
Would you be surprised to learn that a recent report by the National Council on Aging revealed that more and more seniors are borrowing and going into debt?
This topic was taken up by The Daily Item in an article titled "New Report: More seniors falling into debt."
Referring to The National Council on Aging report, the article noted that the median total debt was $40,900 in 2013 for older households with debt.
And that is more than double what it was in 2001.
One third of senior homeowners owed money on a mortgage or home equity line of credit, with 30% owing payments that were more than 25% of their income.
Seniors are also taking payday loans at a rate four times higher in the past five years.
The report also includes the results of a survey of professionals who work with seniors.
More than 90% said that medical debt threatened their clients' financial security. Next was credit card debt at 87% and household utilities at 84%.
Nearly 25% found their senior clients were passing up needed home and vehicle repairs because of debt.
The report found that borrowing by seniors has doubled their debt in the past decade, with more than 61% of households headed by an adult over 60 having some form of debt.
People frequently have mortgages later on when the kids go to college and the parents refinance or move into a new home.
Or a spouse passes away, and the surviving spouse is trying to stay in the home on a reduced income.
In addition to the reduced income, taxes, household expenses, heating and cooling costs, plus other bills remain constant.
Obviously, this is not a good situation.
If you find that you are getting deeper in debt or are facing a Medicaid (read "nursing home") crisis, then contact an experienced elder law attorney for advice.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: The Daily Item (March 8, 2016) "New Report: More seniors falling into debt"