Dealing with debts can be challenging for anyone, but those who are close to retirement might find it particularly challenging. While most people in Connecticut hope to retire without owing money, the reality for many is that this is not possible. Despite this, there are some debt management tips that those nearing retirement can consider to manage both their future savings and outstanding balances.
According to 2016 research, nearly half of all American families with heads of the household over 75 hold debt. For those households run by individuals 55 and older, 70 percent held debt. Those retiring with outstanding balances are certainly not alone, but that doesn't mean the circumstances don't demand some action.
There are a few things aging individuals should consider for debt management. One is downsizing to a smaller home. This is especially wise if children have moved out. Avoiding co-signing for student loans and working part-time after retirement could also help alleviate financial pressure for older individuals. Co-signing for student loans can be particularly damaging, as these debts can often not be discharged during bankruptcy, so parents should make sure they are not putting themselves in a situation where they will be a financial liability to children later down the line.
For outstanding debts outside of student loans, bankruptcy or a structured debt management program may be ideal. Connecticut individuals considering their options should take stock of their financial situation. Then, they should review their options with a lawyer to clarify their options for bankruptcy, debt management and more.