 TITLE: Reasons for Increasing Debt in Older Americans CONTENT: Why is Debt Increasing Among Older Americans?\n---------------------------------------------\n###### Written by: Kristy Welsh\n_Last Updated: July 14, 2017_\nOnce upon a time, the older we got, the less debt we owed. Today, it seems just the opposite. According to the Employment Benefit Research Institute (EBRI):\n*   8.3 percent of households 65 to 74 have debt that represents more than 40 percent of their income.\n*   41 percent of households 65 to 74 have debt tied to their home.\n*   24 percent of households 75 and over have debt tied to their home.\n*   38.5 percent of households 75 and over carry debt overall.\nWhat gives? After a lifetime of hard work and penny-pinching, why are Americans reaching retirement age with more debt than their younger counterparts? In 2016, the average household headed by someone age 55 or older had $73,211 in debt, according to the EBRI. That is staggering!\nTough Time Saving For Retirement\n--------------------------------\nIdeally, it's in our 20's when we start setting aside 10 to 15 percent of our income for retirement savings. The longer we wait -- into our 30's, 40's, or 50's-- the greater that percentage must grow to ensure there's enough in savings to support the cost of living by the time we reach retirement age. Some experts differ on just how much we need, but the safest bet is that whatever your current annual living expenses, assume they'll remain about the same in your retirement years. Yes, some expenses drop off the radar, but you can bet others will crop up to take their place.\nUnfortunately, saving for retirement is far easier said than done. For millions of Americans, it's all they can do just to make ends meet for current living expenses. While setting aside money every month for a retirement fund sounds like a grand idea, it's far more attractive to put that money toward the food they need to put on their tables today.\nLosing Work or Trouble Entering the Job Market\n----------------------------------------------\nIn recent years, as the job market has tightened, older Americans have suffered the consequences. While college graduates may have trouble finding work, older Americans have trouble keeping it. They're then doubly-challenged, as it takes older Americans much longer to re-enter the job market than it does their younger counterparts.\nMedical Expenses\n----------------\nWhile health care insurance and government financial aid programs may help cover most medical expenses, older Americans are still likely to pay something out-of-pocket. For those living on a fixed income, even what sounds like the most negligible of costs can be disruptive to a household budget.\nPaying the Debt of Family Members\n---------------------------------\nNearly 25 percent of Americans 50 and older say they have given money to relatives, or paid relatives' debts directly. And we're not just talking about the most fundamental of living expenses, like rent or food. Older Americans are footing the bill for relatives' student loans, weddings, and down payments on homes. Older Americans are also co-signing for credit cards, which they often end up being held responsible for paying.\nWhile anyone of us can appreciate the generosity of parents, grandparents or other relatives who offer help, it's only a responsible gift to accept from those who have a wealth of resources from which to draw from. Unfortunately, most do not, in which case their financial generosity compromises their own ability to look out for themselves, now and in the future.\nIncreasingly Relying on Credit Cards\n------------------------------------\nLiving off credit cards is nothing new to Americans, but it's a disturbingly increasing trend among the older demographic. Those 50 and older owe an average of $8,278 in credit card debt compared to an average of $6,258 of those under 50.\nJust what are older Americans charging onto these cards?\n*   Medical expenses\n*   Home repairs\n*   Car repairs\n*   Rent\/mortgage\n*   Groceries\n*   Utilities\n*   Insurance\n*   Debts of family members\nSo, at a time in their lives when they should have the luxury of relaxing into retirement, older Americans are stressing over credit card bills instead.\nHow Can Older Americans Get Out Of Debt?\n----------------------------------------\nIf you're 50+ facing a mountain of debt, or know someone who is, take heart. There are steps that can help:\n*   Do not offer financial help to relatives. It does your entire family a disservice when you divert your resources to others at your own expense.\n*   Tighten your budget. This certainly seems like a no-brainer, but we all have little expenses here and there that go unchecked. Go through your budget with a fine-tooth comb and cut where you can.\n*   Think about career longevity and job security. The fact is, you may need to work past traditional retirement years. Your best chances of doing so depend on career objectives that strengthen a long-term plan. Look into growing fields, such as healthcare, education, and non-profits. Get tech savvy. And network, as you never know when and where the next best job op could come from.\nAs for the money you do have in retirement savings, be mindful of who you entrust with its management. While there are many financial advisors who specialize in senior finances, all training and expertise is not created equal. Research carefully what your potential financial adviser's \"senior designation\" title really means (i.e., training time, testing, etc.). If you're satisfied with its requirement, ask for verification of training completion and certification. END