Manny Martinez lives in rent-controlled senior housing and watches his expenses. However, with all of his other bills going up, money from his Social Security—his only income—makes things rather tight financially for the 83-year-old. Sometimes he receives food from a church food bank where he volunteers.
Martinez said it doesn't pay to get a part-time job because his rent would increase.
Martinez hasn't had to borrow money, but his situation is similar to many seniors who are struggling to get by, says The Daily Item in "New Report: More seniors falling into debt."
The report found that borrowing by seniors has doubled their debt in the past decade, with more than 61% of households headed by an adult over 60 having some form of debt.
People frequently have mortgages later on when the kids go to college and the parents refinance or move into a new home. Or a spouse passes away, and the surviving spouse is trying to stay in the home. They have less income, but taxes, household expenses, heating and cooling costs, plus other bills remain constant.
The National Council on Aging report says that among older households with debt, the median total debt was $40,900 in 2013, which is more than double what it was in 2001. One third of senior homeowners owed money on a mortgage or home equity line of credit, with 30% owing payments that were more than 25% of their income.
Seniors are also taking payday loans at a rate four times higher in the past five years.
The report, which includes the results of a survey of professionals who work with seniors, states that more than 90% said that medical debt threatened their clients' financial security. Next was credit card debt at 87% and household utilities at 84%. Nearly 25% found their senior clients were passing up needed home and vehicle repairs because of debt.
Reference: The Daily Item (March 8, 2016) "New Report: More seniors falling into debt"