Housing Debt Putting Greatest Pressure on SeniorsMore than half of Americans over 55 are in debt, according to a new SeniorHomes.com survey. Visit here.
Homeowner costs such as mortgages and home equity loans are the largest source of debt for older Americans (52% of respondents), followed by car loans (17%) and medical bills (12%). And 40 percent of older Americans owe $50,000 or more in debt.
“For most Americans, the golden years are not debt-free,” says Tim Sullivan, Vice President of SeniorHomes.com. “This can make it tough to put aside the funds you need not only in retirement, but for the day when you or your spouse need some type of senior care.”
Medical bills are the main source of debt for older Americans with annual household incomes under $25,000, and the second largest source of debt for those with an annual household income under $50,000. These respondents said they were more likely to consider borrowing money from friends and family or to file for bankruptcy.
How to tackle debt?
Although adults over 65 often face significant debt, they’re less likely to consider debt reduction strategies such as drawing from a retirement fund or life insurance policy, borrowing from friends and family, re-negotiating debt with creditors or selling off assets. “We encourage seniors to realistically consider their future care needs when deciding how to tackle their debt,” Sullivan says.
A year in an assisted living community costs about $45,000 on average, and a year of full-time in-home care is roughly $48,000, according to Genworth. Most of these costs fall to seniors and their families, as Medicare only covers these services in rare circumstances.
The survey was conducted by SSRS. SSRS obtained telephone interviews with a nationally representative sample of 504 adults aged 55 and over living in the continental United States. Interviews were conducted by landline and cell phone in English and Spanish by SSRS from January 14-19, 2018. Statistical results are weighted to represent the target population. The margin of sampling error for the complete set of weighted data is plus or minus 4.9 percentage points.
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