Bankruptcy Trends in the US

Americans age 65 and older are faced with a perfect storm of issues:

  • Reduced income.  Remember, the average Social Security check is $1,661 per month, not enough to pay the bills in most of the US.
  • Delayed full retirement age: for some of us it;s 66, for most 67 and Congress may delay it further.
  • Higher our of pocket costs under Medicare, and the GOP wants to curtain benefits further.
  • Mortgages that extend into retirement, especially if there’s been a renegotiation.
  • Disappearing pensions.
  • 401k losses.

Now, we are seeing a 204% increase in the rate of bankruptcies among seniors.

Basically, to survive life after 65, you need at a bare minimum around $250,000 in cash or liquid investments. For what used to be a “middle class lifestyle,” triple that. However, most Americans have maybe 10% of the bare minimum. Simply, that’s  not enough.

So the “social safety net” now includes bankruptcy.

Now if you think this only affects seniors, think about a increase in the supply of foreclosed homes just when demand is declining. Think underwater mortgages, and declines in housing prices — including yours. This is potential trouble for mortgage companies and especially for those in the reverse mortgage business.

Here we go again.


  1. Deborah Thorne et. al. “The Graying of US Bankruptcy: Fallout from Life in a Risk Society,”





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