Americans age 50 and older are burdened with more credit card debt on average than younger people, according to a survey by the New York-based research organization Demos.
The report shows that older households carried an average credit card balance of $8,278 in 2012.
Credit card debt averaged $6,258 for those under 50.
Moreover, 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-plus also carried medical expenses on their credit cards. Prescription drugs and dental expenses were the main contributors.
The results of the Demos survey of low- and middle-income households is based on a nationally representative sample of 997 American households that carried credit card debt for three months or more. AARP’s Public Policy Institute collaborated with Demos to produce the report.
“It reveals a troubling picture of middle-income 50+ households carrying card debt near or in their retirement years,” said Amy Traub, Senior Policy Analyst at Demos. This may be worrying for people in their mid-50’s trying to save or looking into starting their retirement. It may seem all is lost for saving money for retirement, but there are ways to start building your retirement funds. Despite this reassurance, there are no doubts about financial issues in older people.
- A quarter of older households said loss of a job contributed to their credit card debt in the last three years.
- Nearly one in five (18 percent) older Americans nearing retirement said they dipped into retirement funds to pay down 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).