Seniors are getting squeezed in so many ways. Healthcare and other basic expenses are rising. Fewer have pensions to supplement their Social Security income in retirement. Low interest rates mean what savings they do have isn’t growing quickly — unless they are willing to invest in higher-risk financial products.
And then there’s the other side of the equation: credit. debt, credit report mistakes and identity theft can quickly bring down credit scores older Americans have carefully built over several decades. Here are five major credit mistakes older Americans make, and what to do about them.
1. Using Too Much Credit
Older Americans ...
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Beware of IRS Telephone Scams
Being contacted by the Internal Revenue Service (IRS) can cause concern for any taxpayer, but imagine receiving a telephone call and hearing this:
"This prerecorded message is to notify you that the IRS has found fraud and misconduct on your tax return. This needs to be resolved immediately, and it's very important that I hear from you as soon as possible or a legal action will be taken against you."
Most people are quick to spot the call as a fake since the IRS doesn't threaten taxpayers by telephone, emails, or text messages—or issue arrest warrants. But any scam can work if you aren't paying close attention.
Remember these ...
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Four Dangers of Debt Consolidation
Debt consolidation can be a great way to lower your monthly payments, reduce your interest cost, and simplify the process of paying back what you owe. But, consolidation isn't always the right choice -- and it isn't necessarily a risk-free process.
To make sure debt consolidation doesn't make your situation worse, it's important to understand the dangers so you can make an informed choice about whether consolidating your outstanding debt makes sense for you. Here are four major risks associated with the process that you'll want to mitigate if you plan to take this approach.
1. Going deeper into debt
One of the biggest risks of ...
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Delinquent Credit Card Debt – One Cycle Is All It Takes To Begin the Spiral
Delinquent credit card debt is like having mold in your house. As time passes, they both silently get worse and become more difficult to fix.
When you make a payment after the due date on your credit card statement, you have a delinquent credit card account on your hands. You might think that one missed payment doesn't matter. In fact, many people seem to believe this.
According to the National Foundation for Credit Counseling 2018 Consumer Financial Literacy Survey, 25 percent of Americans said they didn't pay their bills on time. While it's heartening to know that 75 percent do pay their bills on time, the 25 percent who don't are on ...
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Millennials Share Everything With Their Spouses – Except Their Finances
Millennials share everything on social media, but when it comes to their spouses, they are doing a poor job of discussing their finances, which is creating stress and strain in their relationships.
This is just one of the findings from Fidelity Investments' Couples & Money study, which found that, while the majority of survey respondents said they are communicating about finances, one-third don't even know how much the other half of the couple makes, while one-seventh aren't even sure if their spouse is employed.
Life is busy, and millennial newlyweds have to juggle their careers, their marriage and debt. That may be one of the ...
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Baby Boomers Far From Debt-Free In Retirement
Two or three decades ago, it was a foregone conclusion that people would be debt-free upon retirement. Student loans, mortgage debt, car payments—those were the concerns of younger individuals, barriers to entry to the golden years of life. Unfortunately, times have changed.
Per capita, debt among 65-year-olds increased by 48% between 2003 and 2015, according to the Federal Reserve Bank of New York.
Of all types of debt, student loans were the biggest culprit, with the per-capita student loan burden increasing 886% for 65-year-olds during that time frame. Second to student loans was mortgage debt, increasing 47% for those approaching ...
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How Other People Can Affect Your Credit Score
Here are a few of the most common ways that other people can affect your credit score, along with some ways to protect yourself.
1. When you're an authorized user on someone else's credit card
You may think that being added as an authorized user places all the responsibility on the primary cardholder, but in fact, your authorized-user status will also be reported to credit bureaus. While you aren't primarily responsible for repaying the debt, all activity associated with the account will show up on your credit report.
This is why becoming an authorized user is sometimes recommended as a way to build credit. If the primary cardholder ...
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Credit Card Debt Increases Most Since Prior To Great Recession
According to WalletHub, Americans added $92.2 billion in credit card debt in 2017, the most since 2007 - prior to the Great Recession. When you include all outstanding balances, the Federal Reserve estimates that Americans owe more than $1 trillion in credit card debt.
So what’s the deal? In the fourth quarter of 2017, Americans added $67.6 billion in credit card debt, which was the highest quarterly accumulation in 30 years. Looking back over the past couple of years, you can also see a speedy incline in debt, with debt climbing from $43 billion in 2015 to $87 billion 2016. This growing burden could be attributed to historically low ...
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Job Polarization Forcing More Baby Boomers Out of Job Market
Men in their prime working years have left the labor force at an astonishing rate and they may never return if the state of the U.S. job market holds, according to a new report from the Federal Reserve Bank of Kansas City. This does not bode well for those approaching retirement and still carrying debt obligations. This may cause bankruptcy filings to spike in the 55-64 age group.
A decline in demand for middle-skilled work — a phenomenon dubbed “job polarization,” because more positions are concentrated at the higher and lower ends — has played a role in keeping prime-age men out of the job market an economist at the Kansas City Fed, ...
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Are Guarantees of Student Loans Changing The Retirement Landscape?
If you think student loan debt is a problem for the younger generation, think again. According to the Consumer Financial Protection Bureau (CFPB), about 2.8 million people age 60 and older have outstanding student loans – four times the number in 2005. Most of the current student-loan debts of people 60-plus were incurred paying for college for a child or grandchild, and in the past decade, for the 60 to 64 age group, student-loan debt has increased eight-fold – to $38 billion!
“Americans in their 60s are now the fastest-growing age group facing student loan debt,” says Andrew Anable, a financial planner at Safeguard Investment Advisory ...
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