According to a study released by AARP, the amount of bankruptcies filed by people ages 65 and older has increased exponentially in recent years. The study, which was conducted by the Consumer Bankruptcy Project, found that between 1991 and 2007, bankruptcies among seniors increased by 150 percent. For those aged 75- to 84-years old, bankruptcy filings increased over 400 percent during that time.
Experts surmise that this increase in bankruptcies among seniors is caused by increasing medical expenses, causing them to spend their savings, making it extremely difficult to pay their other bills.
Is Bankruptcy Right for You?
Every situation is different, so careful consideration of your current financial situation will help you determine if bankruptcy is right for you. If you file for Chapter 7 bankruptcy, that means that most of your debts may be discharged, with exceptions. Filing for Chapter 13 bankruptcy may allow you the opportunity to pay off your debts over time, based on how much you are able to afford each month.
If your only income is Social Security and you do not own a home or a car, you may not need to file for bankruptcy because the payments you receive cannot be touched by your creditors. But that fact alone does not automatically mean that creditors will stop contacting you. When you file for bankruptcy, however, you get the benefit of an automatic stay, which means that creditors are required by law to stop attempts to collect a debt while the bankruptcy case is active.
Other Considerations
If you do own a home, car or other assets, it may influence whether or not you should file for bankruptcy because you may not be able to keep them. The law does allow you to apply exemptions – the amount of money you are allowed to keep during a bankruptcy – to your property, but if these items are worth more than the exemptions, your bankruptcy trustee may use the assets to pay off your creditors.
What to Do if You Need Help
If you have been having financial difficulties, you do not have to suffer alone. By contacting an experienced bankruptcy lawyer, you can learn how bankruptcy can help you out of a tough financial situation and give you the peace of mind that you deserve.
