For many people, bankruptcy is a fresh start when they cannot afford their debts. In recent decades, however, the number of bankruptcy filings for older adults has increased. Those aged 55 to 64 who declare bankruptcy increased by over 65% from 1991 to 2016. For adults 65 to 74, the numbers increased by 204%.
Why is there such an increase in bankruptcy numbers? Forbes has the reasons for increased bankruptcy in older adults
What causes bankruptcy for older adults
The most common reason that older adults have for filing bankruptcy is medical debt. Over half of all people over the age of 65 that must file for bankruptcy have crippling medical debt. The cost of medical care is expensive. As you age, you are more likely to need more serious care.
Those over the age of 65 are less likely to have income from a full-time job. They may run through their savings to pay off high medical debt. The struggles of older Americans include a lower-income status and higher medical bills.
How older adults can return from bankruptcy
All adults can rebuild after bankruptcy. Bankruptcy does hurt your credit. You will see the largest impact within the first two years after filing, but the bankruptcy remains on your credit report for 10 years. To rebuild credit, however, many people choose to apply for a secured credit card. Secured credit cards allow you to make a deposit and you can spend up to the amount of said deposit. As you rebuild your credit, you will eventually be able to apply for a traditional and unsecured card.