Credit card debt on the rise in retirement living communities

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Credit card debt on the rise in retirement living communities

Thursday, 30 July 2009 15:04

A report from the policy research organization Demos finds that retirement living debts among those with low to moderate incomes are on the rise in America.

In telephone interviews with U.S. households, the researchers found that older Americans' credit card debt had increased by more than one-quarter since a previous Credit card debt on the rise in retirement living communities

Credit card debt on the rise in retirement living communities

study was conducted in 2005, and they were no longer the demographic with the lowest debt load.

"This finding is not surprising given that the data reflects the beginning of the economic downturn in 2008, which greatly reduced the value of retirement savings," note the authors.

The decrease in value of retirement investment instruments has led some seniors to use plastic as a "safety net," the study found, purchasing essential goods and services such as healthcare using credit cards if they cannot do so using their savings.

In fact, those who are paying for healthcare expenses in retirement living had roughly two times the debt related to medical costs as other age groups.

Updated policies that promote savings could also improve health, since the study cites "previous research [that] found households with medical debt often forego treatment by notfilling prescriptions, delay seeking follow-up care, or pursuing other potentially dangerous strategies to avoid incurring more debt."

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