NEW YORK (4/2/13)--Take a debt snapshot of older Americans and the picture looks bleak, but the debt they're carrying isn't what you might expect (The Wall Street Journal March 24).
Recent studies confirm that seniors are headed into retirement carrying higher levels of housing and unsecured debt, and even student loans, threatening their retirement dreams. They are helping adult children and grandchildren cope with unemployment, divorce, and education costs. The one-two punch of the recession and plummeting home values didn't help their already precarious debt situations (The Wall Street Journal March 21).
The latest report from the Employment Benefit Research Institute revealed that for those 75 or older, the percentage with a mortgage or other housing loan was 24% in 2010, up from just 7% in 1992.
New data from the Census Bureau show that more Americans are paying off debt compared with 2000, but those still saddled with debt owe about 40% more (USA Today Mar. 21). The percentage of households with debt fell to 69% in 2011 compared with 74% in 2000, while the median debt load jumped to $70,000. Over the same time period, debt owed by seniors doubled, to a median of $26,000.
April is Financial Literacy Month, which is a good time to proactively start managing your debt:
For more information, read "Parents: Borrow for Kids' College, Jeopardize Retirement" in the Home & Family Finance Resource Center.