Wikinvest Wire

Bankruptcy rising sharply among seniors

Wednesday, June 18, 2008

One aspect of "inflation" as it is reported by the government has always bothered me more than any other. That is, the shopping basket used to determine the Consumer Price Index - the basis for annual payment increases for untold trillions of dollars in government and pension fund liabilities - is not representative of those individuals most affected by it, namely, senior citizens.

With much higher spending on food, energy, and health care than, say, someone in their twenties who lives at home and buys lots of electronics and clothes, both of which have been falling in price for years, seniors are taking a much bigger hit from soaring prices than any other group.

Some time ago, a London newspaper calculated the "pensioner" rate of inflation at ten percent or more and that's probably about what it's running in the U.S. right about now. The last Social Security cost-of-living increase was a miserly 3.3 percent last fall.

So, it shouldn't be too surprising to read that bankruptcy is rising sharply among seniors as reported in USA Today:

Swamped by debt and rising medical bills, elderly Americans have been seeking bankruptcy-court protection at sharply faster rates than other adults, a study to be released Tuesday indicates.

From 1991 to 2007, the rate of personal bankruptcy filings among those ages 65 or older jumped by 150%, according to AARP, which will release the new research from the Consumer Bankruptcy Project. The most startling rise occurred among those ages 75 to 84, whose rate soared 433%.
Medical bills are suspected to be the major cause of the recent increase, but food and energy costs have probably contributed greatly in the last year. It's downright depressing to think that Social Security is the largest source of income for most senior citizens.

Inflation (especially when your government isn't being truthful about it) really is the cruelest tax of all.

AddThis Social Bookmark Button

5 comments:

Nick said...

I realize this is a bold prediction (bordering on deluded fantasy, probably), but I predict that within five years or so, it will become common knowledge in America that the CPI understates inflation consistently and with intentional bias. The current general sentiment, I think, is that the CPI is mostly correct, but may not match everyone's individual experiences, and variations due to the metrics employed can skew the value in both directions.

As they say in AA (and other places): the first step to recovery is admitting you have a problem. The first step to fixing everything that's wrong with the American economy is admitting there's a huge problem with the core numbers (CPI, GDP, etc.), and doing some real honest work to fix them. I'm not delusional enough to think our government will actually do anything positive to fix the problem, but call me an optimist cause I think people will figure out that there is a problem.

Anonymous said...

I don't expect you to answer this, but why should I care?

The boomers had a lot more possibilities than younger people, and all they did was to fuck everything up, and to run up a gargantuan amount of debt that they somehow expect the rest of us to pay off. Let them eat cake.

To any boomers reading this. I'm not joking. I really want for you to just die.

staghounds said...

The boomers are all in their late fifties or early sixties, doofus.

That article was about people 74-84- born between 1924 and 1934. The boomers' parents.

I too want the boomers to die, but they have more selfish harm to do to us yet. Socialised medecine, allowing China to become a military danger, open borders...

born in '63 said...

"To any boomers reading this. I'm not joking. I really want for you to just die."

I love you, too.


"The boomers are all in their late fifties or early sixties, doofus."

Except for those of us in our 40s. Not all boomers are within striking distance of retirement.


"I too want the boomers to die, but they have more selfish harm to do to us yet."

Lovely sentiment. Can you elaborate on that, please?

spnessess said...

The boomers are all in their late fifties or early sixties.
==================
cadeburton
http://www.shepelskylaw.com

  © Blogger template Newspaper by Ourblogtemplates.com 2008

Back to TOP