Bankruptcy is Particularly Popular Amongst Baby Boomers - Westgate Law

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Bankruptcy is Particularly Popular Amongst Baby Boomers

westgate law, southern california bankruptcy attorneys, file for bankruptcy, filing bankruptcy, filing chapter 7 bankruptcyA recent study (American Bankruptcy Institute, ABI Journal, September 2007) indicated that 42% of people filing bankruptcy fall between the ages of 45 and 64. It appears that older Americans are filing for bankruptcy protection at a drastically faster rate than their younger counterparts. In fact, “Baby Boomer” bankruptcies are on the rise.

The numbers are disproportionate. Baby boomers have a higher percentage of representation amongst bankruptcy proceedings. The fastest growth of bankruptcy filings occurs amid the age bracket of 55-64 according the study. Between 2002 and 2007, the percentage of bankruptcy filers between the ages of 55 and 64 increased by a startling 65%. The same study showed that the age bracket experiencing the most drastic decrease in bankruptcy filings during the same time period was in Americans 25 or younger with a 60% decrease in 2007 from 2002.

When attempting to determine the cause of the strange “boom” in bankruptcies amongst the popular baby boom crowd, the study researchers pointed towards the housing crisis in years past as at least part of the cause. The drastically decreasing home prices left a great number of baby boomers without equity. (In fact, this also led to a boom in 50+ homeowners who were victimized by refinancing scams that only increased their need for bankruptcy protection).

The other cause the researchers indicated isn’t surprising out of the norm: high credit card debt and escalating health care bills/balances. Both of these continue to contribute to the increasing number of bankruptcy filings among the older age brackets in America. In 1994, Americans between the ages of 55 and 64 accounted for 7% of bankruptcy filings. In 2007, the same demographic accounted for 15.2% of individual filings. The study, in fact, shows a continuation of a trend that stretches back decades.

While the study doesn’t change bankruptcy law, the benefits of bankruptcy or the bankruptcy process, it does show some of the change in myths related to bankruptcy. It’s not a “copout” for young people who don’t know how to handle their money. It’s not a way to “cheat” the system. It’s not even an “easy” solution. It’s a legal process that is in place for the protection of the American consumer.

If you find yourself in need of bankruptcy protection, please get in touch with the southern California bankruptcy attorneys at Westgate Law. We can help you determine if you are eligible to file for a discharge of debt through Chapter 7 bankruptcy.

About the Author

Justin Harelik

Justin has a singular goal: to get people out of financial distress and move them to financial stability and prosperity. He does this by combining 15 years of in-depth experience in bankruptcy, credit management, debt negotiation and student loan modifications, and he does it with both English and Spanish-speaking clients.

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