Debt And The Elderly
By Cathy Moran, California bankruptcy lawyer on Jan 26, 2007 in General Bankruptcy Information
The fastest growing demographic group of bankruptcy filers is those over 65. The reasons are diverse: fewer traditional pensions; increases in the cost of medical care; availability of easy credit; and efforts to help younger family members all play into the mix.
Seniors are frequently reluctant to share their financial difficulties with family members and often succumb to pressures of bill collectors, paying unsecured credit card debt before food and pharmacy. There are stories around that collectors tell their prey that “bankruptcy is no longer available for your kind of debt” or more frightening still, “we’ve investigated you and you don’t qualify for bankruptcy”.
Retirees, and those saving for retirement, are perhaps the only group to have benefited from some provisions of the 05 bankruptcy amendments. Social Security income is excluded from the means test, and on going repayment of 401(k) loans is protected .
It is worth repeating that Social Security benefits are exempt from the claims of creditors under non bankruptcy law. Seniors may want to consider filing bankruptcy nonetheless as a mental health matter: stop the stress that comes with being hopelessly in debt.
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