As Riverside County consumer bankruptcy attorneys, we were disturbed to read an Aug. 23 Associated Press article suggesting that more and more senior citizens are forced to file for bankruptcy. According to the AP, older people are being affected by the same bad economy as everyone else -- but because they have fixed incomes, they often have less ability to recover. Seniors who expected to live off retirement accounts have seen the value of those accounts plummet, and many lost a second resource when the housing market crashed, taking away equity in their homes. When an emergency strikes, the article said, many seniors with modest incomes turn to credit cards and rack up unsustainable debts.
In fact, the AP said, a study by think tank Demos found that credit card debt has risen 26% since 2005 among seniors 65 and older. In that study, participants reported an average debt of $4,000 for medical expenses alone. And according to the AARP, Americans age 55 and older are now the largest age group to file for bankruptcy protection, with 23% of all bankruptcy filings in 2007. For people ages 75 to 84, bankruptcy more than quadruples. A debt counselor interviewed for the article said she regularly sees women in their 70s and 80s at her counseling center in South Dakota, attending counseling sessions required before they may file for individual bankruptcy. Many had medical bills they couldn't pay with their limited incomes, the article said.
It's dismaying to us as Placentia personal bankruptcy lawyers to see older people forced into bankruptcy by circumstances that are largely out of their control. Retired and older people, especially those with health problems, are missing two of the most important tools available to people trying to get out of debt: time and a flexible income. We routinely counsel our debt settlement clients to consider increasing their incomes and decreasing expenses. Those options are just not available for many seniors, who have trouble getting jobs even if they can work. Furthermore, debt-settlement and Chapter 13 bankruptcy payment plans and rebuilding credit can take years -- years that older people may not have. These circumstances set older people up to spend their golden years struggling with debt.
Howard Law LLP works with clients of all ages who are working to get control of seemingly uncontrollable debts. Our South Gate individual bankruptcy attorneys start every case by reviewing clients' financial situations thoroughly to see if bankruptcy is the right choice for them. We can help clients decide between Chapter 13 bankruptcy, which is best for people with a home to hold on to, and Chapter 7 bankruptcy, which allows qualifying people to sell assets and leave debt behind more quickly. If appropriate, we can also help clients look into settling their debts outside of bankruptcy, or suing to invalidate a debt created by illegal predatory lending practices. We want each of our clients to leave with better economic circumstances than when they came to us, whether that means a lengthy court case or quick out-of-court negotiations.
If you're considering a consumer bankruptcy as a way to get out of overwhelming debt, you should call Howard Law as soon as possible to learn more about your options. For a free, completely confidential consultation, please call us toll-free at 1-800-872-5925 or contact us online.