America's Seniors in Debt: A Growing Problem

Forbes reports that U.S. seniors are carrying more debt than ever, which is exacerbating the ongoing retirement crisis. A 2019 Congressional Research Service report determined that the percentage of U.S. households led by people aged 65 and older with any type of debt rose from 38 percent in 1989 to 61 percent in 2016, while the debt level climbed from about $7,500 to more than $31,000. Those carrying debt into retirement, especially credit card debt, endure more stress and have a lower quality of life than those who do not — while older Americans who own their homes outright have less difficulty staying afloat. Senior households are more likely to have a mortgage, revolving debt, and even student loans, while the amount owed on all types of debt has expanded in recent years even after adjusting for inflation. A study in Aging and Mental Health found that carrying a credit card balance is the strongest predictor of struggling to pay monthly bills and facing financial stress, "stronger than other non-housing consumer debt and mortgage debt." Meanwhile, a survey by AARP and the Ad Council of Americans between age 40 and 59 found that 33 percent said paying off a large debt was their most critical goal, and 21 percent cited building up their retirement savings. Moreover, 11 percent wanted to strengthen their emergency fund.