The Administrative Office of the US Courts recently conducted a study which found that the percentage of bankruptcies filed by middle-aged Americans rose 61% in the five year period between 2002 and 2007. By 2007, Americans born between 1946 and 1964 accounted for 42% of all filers.
Average Age of Bankruptcy Filers
No surprise, the median age of bankruptees increased from 41 years old in 2002 to nearly 45 in 2007. Compare this to less than 38 years of age for average bankruptcy filer back in 1994. The only piece of good news? Bankruptcies for Americans under 25 have dropped off steep since ’94, from 11% then less than 2% in 2007.
Causes of Baby Boomer Bankruptcy
The study felt that the housing crisis was a key cause of greater bankruptcies for older Americans. Many found themselves with much-reduced home equity after the housing bubble burst, and some may have filed Chapter 13 to postpone foreclosure on their homes. No matter what, this increase in bankruptcies could be a reason for the rise in sales at Buy Here Pay Here car dealerships, which have a long history of working with bankrupt individuals.
For more information on this study, check out this news article.