Baby boomers bankruptcies are increasing at a fast pace with many boomers battling with lots of bad debts. The growing mortgage debts and higher health costs make them more vulnerable than the general population. This trend is likely to continue for the foreseeable future. This has been attributed majorly to the rising costs of housing and health care since many older people are more dependent on credit making them most vulnerable to financial rough spots.
Why Are Baby Boomers Filing For Bankruptcy?
Many elders are facing tough decisions regarding their financial future irrespective of the causes for their bankruptcies. Debts are mounting up due to medical expenses, termination of employment, excessive use of credit cards, and divorce or separation. To this effect, many baby boomers are resorting to filing for bankruptcy in courts as the only solution to their personal debt crises.
Lately, there has been an influx of new bankruptcy petitions with the majority of filers being the baby boom generation. This generation is filing mainly because of credit card debt.
Life Changes Creating More Debt
Rising healthcare costs and reduction of pensions are leading more seniors to seek bankruptcy relief. For many baby boomers, their homes are their retirement’s most important asset. Filing for bankruptcy depends on the persons’ understanding of their states’ bankruptcy exemptions policies.
Declaring yourself bankrupt cannot by any chance hinder you from enjoying other economic benefits such as acquiring credit. Additionally, the fact that a home is the most important asset for retired seniors who have equity in homes, bankruptcy can help safeguard it. Most of the time creditors are authorized to take nonexempt property including your house to pay their debt, which bankruptcy can protect you from. To understand all this, you need to consult bankruptcy attorneys who can help you with best options under any bankruptcy condition.
What Are The Advantages Of Filing For Bankruptcy?
Being the most vulnerable lot, filing for bankruptcy may be the better option for most debt-laden baby boomers. Many seniors struggle with large credit card bills and monthly debts that exceed their income owing to the fact that their productivity has depreciated. It is not prudent for them to draw down their retirement assets to settle their debts. Filing for bankruptcy is beneficial for the following reasons:
- It can help eliminate existing medical bills.
- Since most retirement accounts are exempt, the funds do not have to be sold during bankruptcy proceedings.
- Filing for bankruptcy will trigger automatic stay, preventing creditors from taking action to collect their debts.
- It prevents creditors from repossessing property such as cars or suing you.
- Bankruptcy can also allow you have a new start; the harassing phone calls from creditors, letters from creditors will cease and you can keep your future income.
Filing for bankruptcy is a cost effective solution for baby boomers helping individuals becoming free of their debts. Furthermore, bankruptcy gives you the chance to help regain control of your personal finances.
How To File For Bankruptcy
In most instances, filing for bankruptcy is a good solution for most struggling elderly citizens as it can offer you a way out to handle your debt troubles. Bankruptcy is a court procedure. You need to apply through your bankruptcy attorney. An attorney will help you apply to the court under a debtor’s petition or by one of your creditors through the creditors’ petition.
Depending on the complexity of your case, the court would appoint an insolvency practitioner to investigate the case as a Trustee in Bankruptcy who will realize your bankruptcy assets, agree on creditor claims, distribute any dividends and investigate any arising relevant issues. After a year from the date of the bankruptcy order, you will be automatically discharged, and any debts not paid from the recoveries by the Trustee will be written off, which will be to your advantage.
As expected, baby boomers need to be resting and relaxing after a lifetime of struggles and hard work. Debts are stressful at any age and they can be extremely stressful in later years. In this case, baby boomers can and should file for bankruptcy to reduce the pressure and enjoy this stage of life without the added pressure and stress.