As a society, since the 1960’s we have lived an increasingly higher level of living than ever before. My parents and grandparents went through the Great Depression of the 1930’s, but were able to raise their level of living by the 60’s and 70’s and into the 1980’s. Unfortunately, some people lived a little too well by spending more than they saved, overused credit cards, and refinanced their homes to pay for vacations they could ill afford.
Now, in the last couple of decades, people have learned the error of their ways. They are approaching the senior years in debt and struggling to even an acceptable lifestyle. A large number of people have lost their homes, their jobs, and their retirement income, and are now faced with living a level of poverty they would never have imagined when they were younger and living the good life.
Now in their 50’s, 60’s and older, they are humiliated and frustrated by the debt they have incurred and are struggling to get out of. It is nearly impossible to get out of debt when living on a fixed income such as Social Security or retirement funds. They no longer have the means to earn more money with a second job or to work overtime in order to pay off loans and credit cards. Many end up going bankrupt at a time when they cannot even sustain a decent lifestyle.
Pay Down Your Debt
The American Association of Retired Persons (AARP) has come up with a plan to help seniors who are mired in debt. They have begun an initiative called Pay Down Your Debt Challenge that provides information on such topics as how to reduce debt, boost credit scores, and even how to handle family members who are causing them to go further into debt.
While many people are postponing their retirement due to necessity, others are finding themselves relying on credit cards to help them sustain their style of living for as long as they can. This is at a time when their medical bills may also be increasing causing them to go even deeper into debt.
While the ideal is to go into retirement debt free, working to pay down debt is the next best option. Start with the highest interest cards and loans, and work your way down to the lower interest debt. In the meantime, save a portion of your check no matter how small that amount – it will eventually add up and will be there when you have an emergency.
How we handle medical debt
One thing I have done with my Dad’s recent medical expenses after a hospital and rehab stay is to pay off the smaller medical expenses first – some bills were less than ten to twenty dollars – very easy to pay off, while I also paid a minimum on the much larger bills. Then, when the smaller debt was gone, I applied more to the larger and am paying those off as we go. Most hospital and health care providers are very good about letting people make monthly payments as long as they are consistent about paying.
We also cut expenses in other areas such as not eating out as much, cutting our grocery bill where possible, and being careful about making other purchases that we can put off for a time.
In our experience where both of us are living on Social Security and retirement income, there are ways we can cut expenses, pay down debt, and still enjoy life. It may not be the high living that we used to experience when we were all working, but it is sufficient for this time in our lives. And, we pretty much stay debt-free until a medical emergency comes along.
If you want further information about AARP’s Pay Down Your Debt Challenge, go to their website and see what you can do to reduce or totally eliminate your debt. You will feel a sense of freedom when you no longer owe money to anyone, and even have at least some money in savings.