Bankruptcy Over Age 70

With Florida residents retiring slightly later than earlier generations — most people who are at or near retirement age will currently reach what the Social Security Administration (SSA) defines as “full retirement age” at age 67 — it is important to consider how bankruptcy may be an issue for adults at full retirement age or just after. If you are currently residing in Florida for half the year or longer and are considering bankruptcy at age 70 or older, what do you need to know? In short, you are not alone. A student conducted by researchers at Indiana University’s Maurer School of Law addressed the “graying of US bankruptcy” relatively recently, discussing the rise in bankruptcy filings among older adults and the increasing risk factors that lead to bankruptcy in retirement years.

Our West Palm Beach bankruptcy attorneys can discuss bankruptcy among retirees in general terms with you, and we are here to speak with you today if you have questions about filing for bankruptcy after retirement and what the repercussions are likely to be for you, given the particular facts of your case.

Consumer Debt is Increasing in the Post-Pandemic Period, Including for Older Adults 

In the post-pandemic period, consumer debt has been rising significantly, according to a recent article in MarketWatch, and that includes consumer debt among retirees. Many of these older debtors, often aged 70 and up, are realizing that the cost of their medical bills and other living expenses actually exceeds that they are receiving in Social Security retirement benefits, and they do not have any source of money or income that would allow them to be able to pay off medical debt, along with rising credit card debt and personal loan debt.

As a result, there has also been a relatively recent increase in “gray bankruptcy” filings, as the Indiana University researchers discuss and as the MarketWatch article points out. For most older adults who do file for bankruptcy, they have a median income (based on Social Security retirement benefits) of approximately $37,000 per year, and they tend to file for Chapter 7 bankruptcy since a Chapter 13 filing would require a return to work.

Considering Bankruptcy During Retirement 

For retirees, there are relatively few options for increasing their income, as the MarketWatch article explains, without a return to work. Assuming a return to work is not in a debtor’s future plans, is bankruptcy the best option? There are some important considerations to take into account.

First, many of your assets may not be assets that can be touched by creditors — they may be exempt from garnishment, for example, such as Social Security benefits. At the same time, these assets can also be protected in a Chapter 7 bankruptcy case and cannot be liquidated. At the same time, it is also important for seniors to know that many of their debts will not be passed onto their children or survivors in death. Experian data shows that nearly three-quarters of Americans die with debt, and most of that debt does not “survive” the debtor’s lifetime — it will be written off by most creditors. To determine whether bankruptcy might make sense for you, it is important to seek advice from a lawyer who can help.

Contact a West Palm Beach Bankruptcy Attorney Today 

Do you have questions about filing for bankruptcy during your retirement in Florida, or do you need assistance identifying debt relief options that may be available to you even though you are retired? One of the experienced West Palm Beach bankruptcy lawyers at Kelley, Kaplan & Eller can discuss your circumstances with you today. Whether you ultimately decide to file for bankruptcy or to take another path, our firm is here to assist you. Contact us today for help with your case.

Source:

papers.ssrn.com/sol3/papers.cfm?abstract_id=3226574