Seniors going bankrupt in soaring numbers
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Here’s an interesting article from cbc.ca about the increasing rate of bankruptcy among seniors.
From the article: “Seniors are carrying more debt into retirement and, as a result, a growing number are going bankrupt.
According to the federal Office of the Superintendent of Bankruptcy, 10 per cent of those who declared bankruptcy in 2014 were aged 65 and older. That’s a whopping 20.5 per cent increase from 2010.”
To me, this demonstrates the importance of planning for retirement as early as possible. With more and more Canadians carrying debt into retirement I have a feeling the number of seniors declaring personal bankruptcy is only going to continue to increase.
Budgeting for the short-term and the long-term are equally important. Take your mortgage, for example, how long until it is paid off? Do you expect to take out a home-equity line of credit in the future for a renovation or to pay-down other debts? If so, this will likely lead to it taking even longer to pay off that mortgage and could mean you will have to consider your mortgage when budgeting in retirement.
Then you can estimate what your retirement income will be (OAS, CPP, pension, etc.). Subtract mortgage payments and you will quickly see the benefit of paying down your mortgage as soon as possible so that you can free up your retirement cash-flow for the things you enjoy.
Did You Know?
Many people who file for bankruptcy get to stay in their home.
In Newfoundland and Labrador, you can keep your RRSPs – even if you file for bankruptcy.
Many people who file for bankruptcy are able to keep their vehicle.
Most bankruptcies are NOT published in the newspaper.
Student loans can be included in a bankruptcy if they are more than seven (7) years old.
A consumer proposal is an alternative to bankruptcy that can only be filed with a licensed trustee in bankruptcy.