A recent USA TodayÎ¾article and a survey by Demos show consumers 65 and older carrying an average of over $10,000 in credit card debt, and that's up 26 per cent from 2005.Î¾ Rising medical costs on fixed incomes are forcing seniors to rely on plastic to manage expenses.Î¾ Tanisha Warner is with Money Management International.
"Credit cards really should be used as a tool of convenience and not necessarily an extension of your income.Î¾ Sometimes it does allow you to float to the next time that you're going to have some extra cash.Î¾ But, yes, you should use credit only as an extension of your income, and not as a necessity.Î¾ So make a list of all your expenses and figure out, you know, what the priorities are.Î¾ Be sure to make your mortgage payments and rent payments and things that you absolutely need.Î¾ For older Americans — this is one of the demographics, too, that we recommend — that you pay close attention to your insurance coverage."Î¾Î¾Î¾Î¾
Warner says work with creditors on a new payment plan.Î¾ And consider a reverse mortgage.
"If you're living in a home where you have equity in it, that's money that you can tap right now.Î¾ and it turns into income, basically.Î¾ And then you leave the mortgage behind after you pass.Î¾ Right now, if you tap into your equity, there's a check that comes every month that's income, and it basically creates a new mortage loan.Î¾ Depending on how much money you're needing, that the amount of mortgage loan that you would leave behind.Î¾ And then your heirs would either sell the home or take over the mortgage payment."Î¾Î¾
According to AARP, a quarter of the million Americans filing for bankruptcy last year were 55 or older.Î¾ Ed Mayberry, KUHF Houston Public Radio News.