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Today’s Senior Citizen: Retired, Debt-Ridden and Harassed

On behalf of Cohn Lifland Pearlman Herrmann & Knopf LLP | May 27, 2020 |

Debt collectors do not discriminate. Regardless of gender, race, or ethnicity, they place calls to seventy million US citizens annually. Far too often, those communications take the form of outright harassment.

However, agencies commonly exploit a certain segment of the population based on their age. A group that was once known for their financial frugality. Senior citizens were once known for shying away from banks and credit cards. Every transaction involved cash, often stored under a mattress or other areas of their houses.

Financial Instability Tarnishing the Golden Years

Today, retirees are less financially stable than in previous generations. Costs of living, diminishing safety nets, and rising Medicare costs have created a perfect storm when combined with Social Security Benefits not fully available until age 70, an increase of five years.

A significant part of the problem involves a new generation of senior citizens with record level debts that they continue to accumulate as they face retirement. Data from the Employee Benefit Research Institute reveals that nearly 70 percent of households headed by someone who is 55 years or older are carrying debt that averages just under $77,000.

An additional study by four bankruptcy law professors showed that Chapter 7 and 13 filings for people between 65 and 74 rose 300 percent since 1991. Those 75 and older have quadrupled bankruptcy filings over nearly three decades.

In addition to the lack of currency in mattresses, 2.8 million Americans older than 60 owe $86 billion in student loans. That number represents 40 percent of debtors over 65. The rise in tuition costs and willingness to co-sign financing for children played a role in retirements that are anything but debt-free.

When retirement is not an option, careers continue, doubling the 55 and older workforce from 1993.

Underhanded and Unethical Debt Collection Tactics

Debt collectors now swoop in and focus their abuse on older Americans. Their tactics include collecting on debt already discharged or past the statute of limitations. Far too many times, they knowingly and relentlessly pursue the wrong person until they secure the outcome they want.

Should matters lead to litigation, debt collectors roll the dice and file lawsuits with the full knowledge that seniors are unlikely to make a court date, allowing their harassment to continue.

The law provides significant protection against abusive tactics by debt collectors or creditors.  In addition, in many circumstances, bankruptcy is the best option providing a fresh start for those who otherwise would be overwhelmed by debt.  The best course is to consult an attorney who is knowledgeable about both debt collection practices and bankruptcy to understand all of the options available.