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posted by martyb on Wednesday August 08 2018, @06:14AM   Printer-friendly
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

 


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  • (Score: 2, Interesting) by Anonymous Coward on Wednesday August 08 2018, @02:11PM (1 child)

    by Anonymous Coward on Wednesday August 08 2018, @02:11PM (#718786)

    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.

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  • (Score: 0) by Anonymous Coward on Thursday August 09 2018, @12:29AM

    by Anonymous Coward on Thursday August 09 2018, @12:29AM (#719138)

    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.