Bankruptcy Increases Among Seniors Because Of Rising Health Care Costs
The rate of bankruptcy filings for people older than age 55 has increased since 1991 as a result of several factors, including rising costs for consumer goods and health care, according to a Consumer Bankruptcy Project analysis that will appear in the January edition of the Harvard Law and Policy Review, the AP/Washington Post reports. For the study, researchers from Harvard Law School examined a sample of more than 6,000 non-commercial bankruptcy filings in 1991, 2001 and 2007.
The study found that bankruptcy filings for the older-than-55 age group had increased from 8% in 1991 to 22% in 2007. According to the analysis, the bankruptcy filing rate per thousand people increased by 40% for seniors ages 55 to 64, by 125% for seniors ages 65 to 74 and by 433% for seniors ages 75 to 84. Researchers also found that the rate of bankruptcy filing for people younger than age 55 declined during the same period.
Elizabeth Warren, a Harvard Law professor and an author of the study, said, "There's no evidence that the problem is consumerism," adding that seniors are incurring debt to meet needs such as medical treatment. She said, "Older Americans are hit by a one-two punch of jobs and medical problems and the two are often intertwined," adding, "They discover that they must work to keep some form of economic balance and when they can't, they're lost" (Sedensky, AP/Washington Post, 8/27).
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