Did you know that people aged 75 and older have the highest average credit card debt of $8,080 per person as of September 2023? Moreover, 53% of those 75 or older reported having debt, compared to 21% in 1989. That is more than double the number of people aged 75 and older who have debt.
I find these statistics to be extremely scary, very sad, and truly dangerous. But that is not all…check out some of these additional statistics around senior debt:
- Of adults who are 55 and older, one in four worry they’ll never pay off their debt, and 22% are afraid they won’t be able to afford rent or will need help with mortgage payments.
- Older Americans have the highest percentage of home equity line of credit (HELOC) debt, with nearly 5% of those aged 70 and older having HELOC debt.
- In 2016, 46% of homeowners aged 65 and older had mortgage debt.
- Of the 9.7 million older adults who owe money on a mortgage and/or home equity line of credit, 30% have payments that exceed one quarter of their income.
- Housing-related expenses cost adults 55+ an average of $16,219 per year, which is equal to roughly 33% of their yearly budget.
One of the top concerns of adults 65 and older has always been not having enough savings for retirement and not being able to pay off debt. The National Council on Aging and Consumer Finance reports that the number of adults who retire with debt is increasing.
So why am I talking about all these very concerning statistics? It is because there is a great solution to pay off all this consumer debt and eliminate mortgage payments. It is called a Home Equity Conversion Mortgage. Maybe you have heard of it before? Yes, this is a type of reverse mortgage, and it is a fantastic solution to consolidate debt, eliminate mortgage payments of principal and interest, and free up cash flow to ensure that your income goes further every single month.
These fantastic programs have changed over the last 10 years and are much better, more flexible, and safer than they ever had been in the past. If you have consumer debt and a significant amount of home equity, it might be time for you to explore this option.
References:
- https://www.debt.org/advice/financial-assistance-for-senior-citizens/#:~:text=Consider:%2053%25%20of%20those%2075,need%20help%20with%20mortgage%20payments.
- https://www.ramseysolutions.com/debt/average-american-debt#:~:text=HELOC%20Debt&text=In%20other%20words%2C%20you're,with%20a%20HELOC%20owes%20$27%2C272.&text=Older%20Americans%20have%20the%20highest,%25%20for%20those%2070%2Dplus.
- https://www.ncoa.org/article/get-the-facts-on-economic-security-for-seniors
