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from the last-remaining-part-of-the-social-safety-net dept.
Personal bankruptcy among seniors has been growing over the last 25+ years, according to a recent study reported by the NY Times and syndicated nationally, for example at: https://www.seattletimes.com/nation-world/too-little-too-late-bankruptcy-booms-among-older-americans/
The signs of potential trouble — vanishing pensions, soaring medical expenses, inadequate savings — have been building for years. Now, new research sheds light on the scope of the problem: The rate of people 65 and older filing for bankruptcy is three times what it was in 1991, the study found, and the same group accounts for a far greater share of all filers.
Driving the surge, the study suggests, is a three-decade shift of financial risk from government and employers to individuals, who are bearing an ever-greater responsibility for their own financial well-being as the social safety net shrinks.
The transfer has come in the form of, among other things, longer waits for full Social Security benefits, the replacement of employer-provided pensions with 401(k) savings plans and more out-of-pocket spending on health care. Declining incomes, whether in retirement or leading up to it, compound the challenge.
Your AC's google-fu wasn't sufficient to locate the original report, but here is another quote from the Seattle Times link,
As the study, from the Consumer Bankruptcy Project, explains, older people whose finances are precarious have few places to turn. "When the costs of aging are offloaded onto a population that simply does not have access to adequate resources, something has to give," the study says, "and older Americans turn to what little is left of the social safety net — bankruptcy court."
"You can manage OK until there is a little stumble," said Deborah Thorne, an associate professor of sociology at the University of Idaho and an author of the study. "It doesn't even take a big thing."
To show that this isn't something new, here's an NPR report from 10 years ago, https://www.npr.org/templates/story/story.php?storyId=93241953
SEABROOK: So how does that play out for older Americans?
Prof. WARREN: Well let me put it this way. Back in 1991, older Americans, those over 55, were about eight percent of all the people filing for bankruptcy. Today, they're about 25 percent of those filing for bankruptcy. It's been a real shift in the demographics.
The median age and the population, generally, has increased by about three years. The median age in bankruptcy has increased in the same time period by about seven years.
Compare with the currently running story about wages and benefits climbing currently, https://soylentnews.org/article.pl?sid=18/08/05/016226
(Score: 5, Interesting) by Anonymous Coward on Wednesday August 08 2018, @10:01AM (7 children)
68 and retired. I don't make a lot of money anymore. Mostly social security and a small pension. But its enough to pay my everyday living expenses and a little to spare.
However, I was raised during a completely different mindset. Both of my parents had lived through the depression. And that had left a mindset on them which they lived within their means, and taught me to do likewise. They knew things could collapse, and saw to it we kids were given the tools to survive... for me, it was an engineering education, as I believe my dad knew I was autistic or asperger or something like that... whatever it was, I never was very social. All I seemed to want to do was take stuff apart to see how it worked. The social stuff, nor most of the stuff they tried to teach me at school did not mean a thing to me. Sis got into marketing, and my brother got into the performing arts and later teaching... and he's damned good at it too.
In that day, the family treasures went down the family tree by inheritances. However, my Dad and Uncles got the short end of the stick on that one as the family farm we had was sold off to pay Grandma's nursing home bills, as she stayed alive, but needed assistance, for several decades after Gramps died. I guess what I am trying to say is that many middle class families had family money to fall back on, instead of paying insane amounts of usury to banks.
But these days, it seems few of us have resisted the siren-calls of the businessmen and their cadres of advertising agencies. We have lived beyond our means, thinking "fine houses" and cars was an investment. When all it really was was an enforcer to spend yet more resources to "protect our investment".
I see daily one of the young technicians at a small electronics shop I hang out a lot at. ( I can't stop doing electronics, but the owner of the shop lets me pursue some of my personal projects there in exchange for any wisdom I may have to offer to help the other guys out over there. ) This guy is the same age as my nephews. When I was his age, I was debt free, renting, and saving up for a down payment for a house. Contrast my situation to the new tech's situation... he's damn near a quarter million dollars in debt already! Student loans. Both him and his wife. Both working. Both paying tax up the gizwah ( no kids ). Nor does he seem to take debt seriously... he will spend anything he can get someone to loan him. Cameras. Musical instruments. Drones. Vacations. Getaways. Brand new top of the line SUV. Living Paycheck to paycheck. I would feel like I was going down Route 66 between Barstow and Kingman at 80 MPH in a BMW. ( Hint: Route 66 is poorly maintained in that area... I even aborted a 35MPH foray onto that road in my big diesel van because I thought all I was doing was tearing up the suspension in the thing ). These kids are being brought up used to the idea of living under such a mountain of debt that one missed payment somewhere will cause a cascade failure of losing everything... but the meme being you never had anything to begin with, so what's the deal? The meme seems to have changed. You do not have wealth. Instead, you have a credit rating. And you spend your life paying usury. His forseeable future has already been mortaged off to pay for the past.
I get the strong idea that he is not an outlier; rather he is representative of the new generation. A generation born into debt, and accept it as a way of life, where I was raised to avoid it like the plague. This whole thing looks like a house of cards just waiting to collapse to me. I see torrents of ads directed at me trying to get me to reverse-mortgage my stuff, and I think it is plain wrong to die in debt; best plan to leave some to the kids, but its a futile game if the businessmen already have them trained to spend every dime they get their hands on. I would hate to wake up every morning to the question of which debtor is screaming the loudest and how to get whatever it takes to shut it up.
(Score: 4, Informative) by MichaelDavidCrawford on Wednesday August 08 2018, @10:50AM
In the words of the immortal Inspector Clouseau: Not Anymore [warplife.com].
Here's how to deal with a bill collector: "I'm homeless. The only reason I get to eat is soup kitchens."
They never called back again.
Yes I Have No Bananas. [gofundme.com]
(Score: 3, Insightful) by khallow on Wednesday August 08 2018, @12:16PM (5 children)
You can't seriously tell me that you never ran into that kind of person when you were young. For example, despite the passage of the years, I'm still running into people like that who are well over 60. Sometimes they still haven't learned despite living a whole life.
What changed is that no one would have loaned him that kind of money in the past. Plenty of people live paycheck to paycheck and make poor, short-sighted financial decisions. Not everyone of those owes a quarter of a million in nondischargeable student loans, guaranteed by the US federal government. Even now, there's young people who make good decisions just like there was way back when. Don't characterize an entire generation by its weakest members.
(Score: 0) by Anonymous Coward on Wednesday August 08 2018, @02:06PM (2 children)
Khallow, there are people like this all over the world--to the extent that articles are written about how they are handling their old age after a life of treating credit like discretionary income--and how people that behaved differently are experiencing a different type of retirement that doesn't include bankruptcy.
Sometimes, that 'pull yourself up by your bootstraps' also means wearing the same old boots and replacing the laces when they fray, rather than getting the new high tech ones that sync to only the newest models of flagship android phones.
but the marketing doesn't ever really talk about responsibility, because that diminishes shareholder value.
(Score: 1, Interesting) by Anonymous Coward on Wednesday August 08 2018, @02:54PM (1 child)
While states treated exponential growth as a possibility and will attempt to palm off pension liabilities to the tax payer. [dollarcollapse.com] "Experts" they said!
(Score: 1) by khallow on Thursday August 09 2018, @01:23AM
"Attempt" is a rather weak word to use here when many of those states (both US states and country-level governments) have succeeded for decades. It might not be coincidence that an ignorance electorate tends to have an ignorant government.
(Score: 2, Interesting) by Anonymous Coward on Wednesday August 08 2018, @02:11PM (1 child)
AC Senior Parent again...
Yes, I did see some of that at University. Usually kid of rich parents. Spent like there was no tomorrow... but like you say, no one would have loaned him that kind of money, so the debt situation did not exist. There were those who went into debt, and I remember watching most of them crash and burn...
They were in and out of payday loan centers ( note their logo [paydaymoneycenters.com] is either a crown, or a pair of handcuffs, according to how you look at it!) for the rest of their lives.
In those days, the Government was not so "Jonny-on-the-spot" with bailouts, so if the bank loaned money and didn't get it back, they took the hit directly.
My belief that all these government bailouts are to shield the banks from loss, by keeping the debtor from walking away, keeping him trapped in the contract.
But they phrase it as "helping the homeowner" because that sounds better to the public whose taxes are being used to bail out the banks in this manner.
I will characterize it as I see it... I see the younger generation doing stuff that I was trained not to do, as well as using tools ( especially things like social media ) which to me is risky. But I also know I have gotten older, and prone to the very same things I sullied my Dad's generation for. Especially things like not being "flexible" and "resistant to change".
I am not blaming the younger generation, but I do feel they are being led by business, like a Judas Horse leads a herd of wild horses, into a corral of debt.
I have had words with him over it. I believe he understands my concern, but also dismisses it as the unwarranted fear of an old half-senile scardeycat. His take seems to be that life should be enjoyed today when and while it can be enjoyed, and deal with Tomorrow's problems Tomorrow.
I have related to him my fear of waking up in the morning, having dozens of heads circling over me, each demanding payment I do not have, and trying to figure out what to do to make them go away, knowing I only have resources for one or two of them, and even that will only shut the head up for a month before its buzzing around again wanting its due. Those heads won't be nearly as nice as they were when they were presenting their papers and flourishing the pens for his signature. His take seems to be .... well, he got to use the resource for so many years... if they take it back, he can always get something else, maybe not as nice, but if its there, he's a fool not to take it. And the banks seem to be chasing him, wagging fistfuls of money in his face, if he will sign their notes. He's a sought after commodity. A young person with an expected lifetime of several more decades. I think he's being raped. But he seems to be enjoying it.
Ok, maybe I am just an old fuddy-duddy that not going along with the show, and we each have our own comfort zone. I will have to let it go at that. I am not in any position to control him, nor am I responsible for his getting into debt. Just a friendly concern, same I would have if I saw him fixing to pump diesel into his brand new SUV, which I know his is a gasser. I would attempt to keep him from doing it, even if he rebuffed me, but I would not force my beliefs on him, and would have to let him proceed if he wanted to, even though I *think* I know the consequences of doing such a thing. There is always the possibility that engine technologies have changed and the new engines will take it, contrary to all beliefs I have. My concept of "Flex-Fuel" may be full of shit. In that case, all I can do is get out of the way, and learn a thing or two.
(Score: 0) by Anonymous Coward on Thursday August 09 2018, @12:29AM
What's funny is that a lot of the stuff these people go into debt for makes them happy for five minutes and then they don't care anymore. You can enjoy life without being a debt slave, constantly wasting money on drugs (including alcohol), etc. So the 'live in the present' argument is total nonsense.
But it seems a lot of people have been indoctrinated by corporations into believing they need these shiny goodies, and they just don't have the critical thinking skills to resist the indoctrination. So, to a large extent, I feel no pity for the people who choose to become debt slaves when it was completely avoidable.