Why Baby Boomers should Rethink Debt
The collective perception about how people view debt has changed. During the past three decades, living in debt has become the new norm to many baby boomers. Debt doesn’t carry the stigma it once did, which has begun to alter the way that people spend and save.
Research from insurance provider Allianz Life provides some insight on the current view of debt among baby boomers. Almost half of baby boomers feel that credit cards are an important survival tool. Even people who have always been careful with their spending are now carrying a lot of credit card debt. And this could be a problem as more baby boomers attempt to transition to retirement, because credit card debt is affecting their ability to save for retirement.
Paying Credit Debt vs. Saving for Retirement
In responding to Allianz’s questions, 19 percent of baby boomers interviewed believed that credit card debt needs to be paid off before saving for retirement. This puts baby boomers with high credit card debt at a disadvantage. Not having enough retirement savings, or going into retirement saddled with a large amount credit debt can be a serious problem.
If you’re concerned about your credit card debt heading into retirement, filing for bankruptcy to discharge that debt might be an option to consider. It depends on your assets, which determine your ability to pay off all or part of your debt.
In most circumstances, you can keep your home and your car, even if you were to file Chapter 7, instead of Chapter 13 bankruptcy. Larry Karandreas can explain your options to assist you with reducing your debt as you move toward retirement. Reducing your debt now could empower you to put away money for retirement.