Bankruptcy and The Elderly – AgainAugust 21, 2018
Since my last blog on Bankruptcy and the Elderly in 2014, the problem has actually become worse.
Recently, the New York Times had an article entitled “Too Little Too Late: Bankruptcy Booms Among Older Americans.” See New York Times, August 5, 2018.
Among the possible reasons stated were the problems of reduced retirement income due to fewer older folks having pensions, and the very rapid increase in health care costs for the elderly. In a nutshell, employers and governments are shifting these costs onto elderly people. The article goes on to say that 12.2 percent of bankruptcy filers are now 65 years old or older, up from just 2.1 percent in 1991.
Sadly, the other issue is that bankruptcy is considered a “fresh start,” but for older Americans, this is too little too late which was the subject of the article.
As I noted in my blog in 2014, much of the cause of this is the high cost of medical expenses for elderly people. In my blog, I talked about expensive prescriptions. According to the New York Times, 60 percent of elderly bankruptcy filers cited unmanageable medical expenses as the reason. In addition, combined with the fact that health care requires supplementary insurance, there are very few elderly people that have medical benefits that extend into retirement. (Besides Medicare). This has created a growing number of people who need to file bankruptcy to cover out-of-pocket costs for healthcare.
Another disturbing trend is that many people now are taking equity from their homes to pay for bills. This can be a satisfactory outcome for younger people, but it can be very difficult for the elderly. In fact, the number of older folks with mortgages is on the increase. It is usually understood that most people entering retirement would have paid off their mortgages. This is no longer true.
Finally, another category of problems is the need for older people to help their children. Elderly people can be forced into bankruptcy because they have co-signed loans for adult children. When these loans default, the elderly parents have no ability to pay them and are therefore forced into bankruptcy.
While this is a regrettable situation, bankruptcy provides an opportunity to discharge certain types of debts. Medical expenses are included. If my firm can assist you in a bankruptcy, please feel free to contact my firm regardless of your age. For further information and costs, contact Steven P. Miner, Esquire at (717) 724-9821 or sminer@daleyzucker.com.
