Older Americans Carrying More Debt than Younger Generation
Middle-income Americans age 50 and older are now carrying more credit card debt on average than younger people, according to a 2012 study released by Demos. This is a reversal of the findings from the Demos survey which took place in 2008.
The report, entitled 2012 National Survey on Credit Card Debt of Low- and Middle-Income Households, shows that middle income households aged 50 and above are looking at the prospect of carrying high credit card debt as they near retirement years.
The study shows older Americans have been disproportionately hurt by the economic downturn, with many resorting to credit cards to make ends meet as gasoline prices rise and housing values decline. Older households carried an average credit card balance of $8,278 in 2012 compared to the $6,258 average for households under age 50.
For households that carried credit card debt for three months or more, the report found:
- A quarter of older households said loss of a job contributed to their credit card debt in the last three years.
- A third of older households used credit cards to pay for basic living expenses such as rent, mortgage payments, groceries or utilities.
- Half of Americans age 50+ carried medical expenses, commonly prescription drugs and dental expenses, on their credit cards.
- Nearly one in five (18 percent) older Americans nearing retirement said they went into their retirement funds to help pay some of their credit card debt.
- Older Americans were twice as likely as those under age 50 to take on credit card debt to assist other family members (23 percent vs. 11 percent).
AARP’s Public Policy Institute collaborated with Demos to produce the report.