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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: 0) by Anonymous Coward on Wednesday August 08 2018, @02:02PM (3 children)
What I am reading here is that the expectation was that the parents were unable to save, and thus expected Grandma's savings to bail them out.
Grandma was not too big to fail, and not only that, if she received such a reverse mortgage, it probably was true that she needed a bailout herself. That saved her, and let her age out her timer and die apparently gracefully.
I don't know why I am upset that people expect an inheritance to solve their financial troubles. I told my own parents to spend their money; that it would be nice if they left something for us kids, but ultimately they already raised me and I moved out. Anything after that is a bonus. I would rather have them live in comfort than worry about how I have some sort of expectation for their money when I can finally pull it out of their cold, dead hands. I have no sympathy for people that expect to receive money as an inheritance. Financial planning should only involve the expenses resulting in the death of another person, not the one-time bonus to bail our one's own inability to consider setting aside money so one's own children can hold the same expectations about when you die.
It might be better to actually talk to your parents about their finances. I can only hope the xbox went up on ebay to pay for the college expenses that I am sure the parents were not contributing towards because they expected someone else to pay for it. (and realistically, the kids should be paying some of their own way, but I expect that they have been conditioned to believe mom and dad will handle everything since it seems that is what mom and dad were conditioned that way themselves.
You're right about the gift cards. They go down in value in many countries and states, provided there is no law against excessive 'management' fees. Those guys should be paying interest, and instead they charge a fee. If grandma loves you, she will not give you a gift card purchased with a reverse mortgage source of funding.
as to sales people, yes the goal is to screw the other side in a way that makes everyone happy. It doesn't work as well when both sides are trying to operate the screw driver at once.
(Score: 0) by Anonymous Coward on Thursday August 09 2018, @12:07AM
Like good Consumers. The vast majority of the things people think they 'need' and waste their money to get are totally unnecessary and do not even make them happier.
It's the same for kids depending on inheritance money. Oftentimes, they simply wasted their own money and now don't have any. People have this mindset that they need all these shiny goodies, but they become more poor because of it.
Because everyone has to go to college, for some reason. Even though it's perfectly possible to educate oneself in the 21st century, as we all know, knowledge only exists in schools. Unless someone's profession requires them to have a degree by law, I would try to seek out employers that don't play the credentialism game, rather than going into debt.
(Score: 2) by FatPhil on Thursday August 09 2018, @01:34AM (1 child)
They seem about as bas as a ponzi scheme where each month you become the bigger idiot.
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 0) by Anonymous Coward on Thursday August 09 2018, @10:15AM
> Holy moley, I'd never heard of a reverse mortgage before
Another poster child for financial education in grade schools.
https://www.americanadvisorsgroup.com/news/history-reverse-mortgage [americanadvisorsgroup.com]
It seems like it started out as a good thing, for specific circumstances...