Americans are living longer, but those golden years are too often marred by financial hardship. In fact, a recent study by the Consumer Bankruptcy Project (CBP) found that bankruptcy filings among senior citizens have increased fivefold in recent years.
The CBP attributes the alarming increase in seniors seeking bankruptcy protection to a number of factors. Among them are job losses, lower wages, cuts in government programs that provide a safety net to struggling Americans and rising health care costs. Researchers also note that many seniors never fully recovered from the recession of a decade ago.
A spokesperson for the Tennessee Senior Law Alliance notes that many seniors in our state report that they cut back on food, medications and other necessities in an effort to stay on top of their bills. She says, “It’s inherent within their character and they want to pay the debt. It’s a matter that they don’t have the ability.”
Unfortunately, seniors (like people of all ages facing financial challenges) often use credit cards and loans from payday lenders to pay their debts. Of course, this only makes their overall debt situation worse. Payday loans typically have annual percentage rates (APR) of at least 400 percent. The head of the National Institute on Retirement Security says, “Some of those things really just get you into a vicious cycle that is so hard to get out of. The only way many individuals see to get out of it is bankruptcy.”
Tennessee has the unfortunate distinction of regularly being among the states with the most overall bankruptcy filings. However, sometimes bankruptcy is the best way to extract yourself from a mountain of debt that’s just getting higher and to get a fresh financial start. It’s never too late to do that. An experienced Tennessee bankruptcy attorney can review your options with you and help determine the best one for you.