Why Debt Among Older Americans Is Going Up

Policy Genius estimates that 60-something Americans' outstanding debt in 2019 was $2.14 trillion, reports Fox Business . "Many of our older generation continue to work just to keep ahead of their bills," said Well Kept Wallet's Deacon Hayes. "In addition, some have either depleted their savings to pay off debt, or have no savings at all due to a lack of funds." Data from the Congressional Research Service said the average debt for senior households is $86,797, which is mostly due to mortgage loans associated with primary residences, with the rest spread across other types of debt like student loans, car loans, credit cards, and home equity loans. A report from AARP indicated that Americans 50 and older owe 20 percent of the country's $1.5 trillion in outstanding student loans, while the Federal Reserve Bank calculates that those 60 to 69 who are newly retired or about to enter retirement have roughly twice as much student loan debt as those 70 and older. Factors underlying increasing senior debt include more parents and grandparents co-signing private student loans for their children and grandchildren. Meanwhile, those retiring before 65 may depend on loans or credit cards to cover medical costs if they are uninsured during the gap before they become Medicare-eligible. Hayes recommended that seniors should focus on finding ways to manage and pay down debt as fast as possible, such as refinancing.