Taxation & Estate Planning

Credit Card debt Crippling Retirement?

By Deirdre Wheatley-Liss

Oftentimes the oldest generation of Americans are seen as the most frugal - they experienced the Great Depression, they abhor debt, they saved their pennies, and while they may now be living off of social security, at least they don't owe anyone money.  

A New York Time blog post in The New Old Age challenges that picture today in the posting "Retirements Swallowed by Debt".  There are some bleak statistics in the article:

• growing numbers of elderly want or need jobs
• 30% of workers over 55 have more credit card debt than retirement savings
• average credit card debt for those 65 and older is $10,235

I think the critical take away from the article is how children seem to stumble across the problem as a surprise - not an issue being candidly discussed.  I know my clients often hide the debt, embarrassed by the situation.  Their kids are then shocked when no only are the dealing with a health care situation (which is what typically brings them into looking at the finances), but also a money management situation.

The solution - communication.  I am not advocating that anyone who is retired turn over their finances.  However, I think the question every once in while to mom and dad "are you doing OK financially - is there any way I can help" can open the door to talking about issues before they become problems.

Full post as published by New Jersey Estate & Elder Planning Blog on January 26, 2011 (boomark / email).