
Bankruptcy Booms Among Older Americans - mooreds
https://www.nytimes.com/2018/08/05/business/bankruptcy-older-americans.html
======
ransom1538
What ever you save with your blood sweat and tears will be burned on medical
expenses. Your best bet (after being diagnosed with something severe) is to
convert all your last savings to cash, give it to a loved one, explain to the
government you are broke, and die on the street. [1][2]

Nursing homes and hospices are designed to suck out your funds until you are
dry, then dump you on state aid.

1\. [https://www.senioradvisor.com/san-jose-ca/how-much-do-san-
jo...](https://www.senioradvisor.com/san-jose-ca/how-much-do-san-jose-nursing-
homes-cost)

"The average annual cost to seniors nationally is $80,300 for a semi-private
and $91,250 for a private room in 2015"

2\. I originally had "in a state funded hospice", but opo pointed out that
medicare will strip you of your benefits due to their claw back system. You
may want to look into committing a felony, for state funded care.

~~~
ThrustVectoring
My plan is to intentionally OD on opiod patches if it gets to the point where
I'm too sick to live independently and am burning through savings to suffer
like that.

The gift route gets clawed back; the system is designed to take all your money
first before subsidizing care.

~~~
samsonradu
There is something deeply disturbing and saddening in the honesty of your
comment and sibling comments regarding this topic.

~~~
ThrustVectoring
There are some lives that I simply don't consider worth living.

~~~
samsonradu
Nah, I get that part. The part I don't get is where did we, as a society, fail
so badly for people to even consider the things that I read around this
thread.

------
fisherjeff
I originally came across this article via[0], which contextualizes it within
the broader US economy. It would seem that the word "older" in the headline is
a bit misleading.

[0] [https://www.motherjones.com/kevin-drum/2018/08/just-stop-
it-...](https://www.motherjones.com/kevin-drum/2018/08/just-stop-it-the-
elderly-are-doing-fine/)

~~~
grasshopperpurp
Appears you and MJ are right (graphs start on page 24).

[https://www2.census.gov/ces/wp/2017/CES-
WP-17-54.pdf](https://www2.census.gov/ces/wp/2017/CES-WP-17-54.pdf)

~~~
rossdavidh
"Individuals are likely to get divorced in the years before bankruptcy and
then remarry. Income falls before bankruptcy and then rises after bankruptcy."
In the midst of an otherwise depressing read, this is actually good news. It
indicates that people stuck in a downward spiral of stress and bad financial
decisions, are able to break out of that spiral by declaring bankruptcy. That
is exactly what it is designed for.

------
ginko
How can a 72-year-old retire just get his health insurance revoked? What's
even the point of health insurance when it only covers the young and healthy
apparently.

~~~
wallflower
That does not make sense. Even if he lost his union provided healthcare
insurance, the magic age for retirement in the US is 65 because after that age
you are covered by Medicare.

Medicare, if you were not aware, is available to everyone who is a US citizen
over the age of 65.

~~~
anoncoward111
I'm an insurance broker. Why this man didn't sign up for Medicare and Medigap
($300 a month for complete coverage of everything) is beyond me.

Most employers often encourage seniors to go take Medicare asap. Someone
failed this man, this is basic information.

~~~
pnathan
> I'm an insurance broker. Why this man didn't sign up for Medicare and
> Medigap ($300 a month for complete coverage of everything) is beyond me.

People screw up. People forget. Errors occur, constantly.

It _should_ be an auto-sign up with an opt-out form.

~~~
prostoalex
No. Medicare penalizes early sign-ups
[https://www.kiplinger.com/article/insurance/T039-C000-S002-w...](https://www.kiplinger.com/article/insurance/T039-C000-S002-when-
to-sign-up-for-medicare-when-to-delay.html)

------
hardtke
One worrisome trend is the fact that more homeowners are retiring with large
mortgages. The days of the mortgage burning party are over. Banks seem happy
to do cash out refis on homeowners soon to retire.

~~~
rhombocombus
I am appalled at the ads I see targeted to that generation for cash out refis.
Why would you want to do that to your kids?

~~~
ebikelaw
Taking things out of the economy for themselves is the decades-long operating
mode of the generation this article discusses. They went to free colleges and
gave their kids ludicrously expensive colleges. They bought houses at fair
prices, down-zoned their towns, and forced their children to move far away.
They ran government deficits instead of paying taxes. They converted regular
schools to adult schools, regular libraries to senior centers, etc. The fact
that they would cash out their assets and leave nothing to their kids is 100%
consistent.

~~~
jhayward
This is a grossly unfair reading of what has happened in the economy over the
last 40 years, and how it got that way. Unfair enough to be simply a lie.
Please stop with the inter-generational warfare rhetoric - we have enough
things dividing us as a people, by folks who want us divided. [edit: spelling]

~~~
ebikelaw
Why is it up to the younger generation to call off the inter-generational war?
Facts are facts. 65 and older are now the least likely age group to live in
poverty. Net wealth of people 65 and up has increased 50% since 1989 and
fallen for all others by 25%. These outcomes are no accident. They are the
direct result of an overt policy agenda, from Prop 13 to Reagan to Trump.

~~~
jhayward
> _Why is it up to the younger generation to call off the inter-generational
> war?_

It's up to those throwing rocks to put the rocks down.

> _Facts are facts_

Aside from ascribing some kind of universal evil intent to people simply based
on when they were born, which is idiotic, those are cherry-picked facts that
do not accurately sum up the economic reality of how the US got to where it is
now.

For instance, why not include the fact that the older generation was
responsible for the most prodigious productivity growth the world has ever
seen? Or that they've overseen massive increases in longevity, decreases in
morbidity and childhood mortality, huge increases in number of people
achieving higher education, etc?

They overcame the enormously damaging economic situation of the 1970's, which
the younger people have absolutely not a clue about, and many have suffered
decades of decreasing employment and wealth as a result of economic shifts in
manufacturing and resource production.

There are economic challenges in every generation. The ones facing young
people today are not the same as the ones that faced their parents and
grandparents. It does no one any good to try to stir up hatred at a sub-group
to gain political power, which is what the generational warfare is about.
Leave that for the Fascists.

~~~
ebikelaw
> have suffered decades of decreasing employment and wealth as a result of
> economic shifts in manufacturing and resource production.

It's the counterfactual basis of your argument that makes it absurd. It is
undoubtedly true that this describes some people in that age cohort, but it
doesn't describe it generally. They are much wealthier than both their
ancestors and their descendants. While every generation faces its particular
challenges, only one living generation faced those challenges by intentionally
impoverishing the future.

As for the remainder of your points -- morbidity, mortality, educational
attainment, and whatnot -- it is the case that the USA has underperformed all
other advanced nations in these measures. You'll excuse me if I don't credit
Boomers for falling behind countries like Cuba, Portugal and UAE.

------
ithinkinstereo
> Driving the surge, the study suggests, is a three-decade shift of financial
> risk from government and employers to individuals, who are bearing an ever-
> greater responsibility for their own financial well-being as the social
> safety net shrinks.

This is going to be an increasingly serious problem over the next few decades.
Expect bankruptcy filings to increase across the board, across all generations
going forward.

This is my main critique of the "sharing" economy and tech darlings like Uber
and Lyft, who have accelerated this anti-labor trend. What I find especially
ironic here is that these services are currently only economically viable
because of VCs subsidizing the costs, who themselves source a large percentage
of their funding from traditional employee pension pools, etc. But of course
it's all worth it because these "sharing" companies are just sooooo
convenient.

~~~
maxxxxx
With pensions and stuff there was a well defined path for people to get old
and survive. What's the plan for an Uber driver when they get old? In general,
society really needs to think what should happen with older people who aren't
wealthy.

~~~
rukittenme
> What's the plan for an Uber driver when they get old?

Save a minimum of $5500/year or 10% of your annual salary. Whichever is
greater (up to your cap).

~~~
mirimir
I think that you forgot the /s tag.

~~~
rukittenme
I did not. The parent comment asked for a plan and I gave him one. How you
meet the objective is up to the individual.

~~~
mirimir
Do you seriously think that most Uber drivers are earning enough, net after
expenses, to manage that?

~~~
rukittenme
It's a meaningless question. "Uber drivers" isn't well defined. How much do
most Uber drivers earn? What are their living situations? Do they have
multiple jobs? How many hours do Uber drivers work?

A better question would be: "do you think an Uber driver who (a) lives alone
(b) in a two bedroom apartment (c) in the heart of San Francisco and (d) works
20 hours per week will be able to save $5500/year?" The answer is no. But
there is a lot more to the problem than just "Uber driver".

~~~
mirimir
Sure, "Uber drivers" isn't well defined.

But from what I've read, for any reasonable definition, the percentage able to
save that much is arguably small. Indeed, it's arguable that most of them are
losing money.

~~~
rukittenme
What you've read (and I've also seen though not studied in any depth) is that
a statistical category of person called "Uber driver" may lose money. But the
statistical category of "Uber driver" is not the same as a "person who drivers
for Uber".

Consider the argument: "can an Uber driver save for retirement?" If we define
Uber driver as: "works for uber exclusively for 40 hours per week". Our answer
to the question might be yes or it might be no. Ultimately what matters is the
_number of people_ who fall into that category every day for the rest of their
lives.

If we find no people fit that category or that the people who do fit that
category don't fit it for very long then we can safely say the answer to the
question is irrelevant.

After all, "can unpaid interns save for retirement?" is a meaningless
question. It doesn't matter. Statistical categories don't retire. And people
who work as unpaid interns do not remain so for very long.

A person who drivers for Uber may just need quick, supplemental cash. Cash
that may be exclusively funneled into a person's retirement account.

If we compel Uber to provide a "living wage" or a retirement package, we may
find that those who need quick cash go without it. And people who would have
saved for retirement are now not able to.

~~~
mirimir
That is indeed the vision being sold for the gig economy. And I'm sure that it
can work that way for some. But for the vast majority, even short term, it's
looking like a con. It's like the 10s version of multilevel marketing.

------
RickJWagner
I gave a talk about generational differences in the workplace this year, so
had a fair amount of research about how different generations manage finance.

The charts do a good job of telling the story, but it basically goes like
this: Children of the great Depression were terribly frugal, working hard to
avoid a future financial hardship. Then the next generation (the one described
in the article) decided they were not going to be miserly penny-pinchers like
their parents. They bought everything with the belief they'd pay it off later.
Now the next generations see the folloy in _their_ parents behavior, so now we
have the FIRE generation, once again pinching pennies.

And so the pendulum swings back and forth. And the beat goes on.

~~~
checkdigit15
This is a good point, in fact recently there have been a spate of articles
claiming that millennials are saving too much (in cash at least) and not
putting enough in the stock market:

"42% of Millennials are investing conservatively, compared with 38% of
Generation X investors and 23% of baby boomers, according to the Fidelity
survey." source:
[https://www.forbes.com/sites/andreacoombes/2018/03/13/millen...](https://www.forbes.com/sites/andreacoombes/2018/03/13/millennials-
are-good-at-saving-but-investing-not-so-much/)

But having lived through 2007-2009, it's no surprise they have a preference
for cash in the bank.

------
knuththetruth
Link to underlying research/paper:

[https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3226574](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3226574)

------
grosjona
I hate how decent people in this society just keep playing by the rules even
when those rules are obviously not working for them.

~~~
the_new_guy_29
What else you can do ? Either play the game or die. Thats the only choice you
have rly.

You know what i hate more ? The fact that our governers make sure you wont
even live long enough to make use of "any" of those retirement entitlements.

Best for them would be all of us dying right after "work age".

~~~
grosjona
That's why I also hate the typical CEO/entrepreneur mindset; a lot of them
think that they're helping to grow the pie and taking a small slice for
themselves as a reward - In reality, the pie doesn't actually grow and each
time that they take out a slice, there is less pie remaining for everyone
else.

Corporate stocks are not actually growing in value, it's just the entire money
supply which is being diluted for the benefit of corporations at the expense
of everything else.

~~~
csense
> In reality, the pie doesn't actually grow and each time that they take out a
> slice, there is less pie remaining for everyone else.

If the pie doesn't really grow, why has the world economic output increased so
much in the last 200 years?

~~~
grosjona
How does one measure that? With fiat currency? By the total number of goods
produced? How does the quality of output fit into this model?

If you get more of something but quality is lower then it's not necessarily
progress. You might need more of that thing to get the same value out of it.

------
frockington
The chart showing bankruptcies changes per age group make it seem like its the
same generation constantly filing for bankruptcy. Younger and middle aged
bankruptcies have declined 50% while older bankruptcies have risen ~100%.

~~~
cryoshon
possible explanation: the younger generations aren't that sick yet, so they
don't face massive medical bills for the most part. likewise, the younger
generations don't have enough money to even approach certain sources of debt
like a mortgage. (is mortgage considered a debt?)

~~~
izzydata
It seems like it is technically a debt, but financially I wouldn't consider it
debt until you have either failed to pay it back in the agreed upon time or
are missing payments.

~~~
gowld
The word you are looking for is "secured" debt.

[https://www.lendingtree.com/glossary/secured-
debt/](https://www.lendingtree.com/glossary/secured-debt/)

------
cryoshon
>The questionnaire asked filers what led them to seek bankruptcy protection...
About three in five said unmanageable medical expenses played a role. A little
more than two-thirds cited a drop in income.

there you have it: the US healthcare system is driving responsible people into
poverty, especially when paired with stagnant or falling income.

the solution is socialized universal healthcare. we will also need to re-
create the social safety net somehow in a new and vastly expanded role. to be
clear, silicon valley doesn't have a role to play here, aside from paying
their taxes.

~~~
mistermann
> to be clear, silicon valley doesn't have a role to play here, aside from
> paying their taxes

I was with you up until there....what's the thinking behind that part?

~~~
cryoshon
privatization won't fix the problems that privatization caused.

likewise, our society can't use software alone to solve our socioeconomic
problems.

note: this is not because software is incapable of being part of the solution.
far from it. but software is not about to rectify these issues without a
political will to do so, which is separate.

------
candiodari
I find it baffling how people think about this. In this case, money really,
really, really does represent work.

You might be complaining the state doesn't pay for the elderly to retire
easily ? Ok, let's do some basic calculations to sketch that out.

Right now there's a little over 12% elderly in the US (and really more like
10% once you take out the ones still working). That number is just about to
rise rapidly to 15% by 2021 or so, then a little slower to ~25% by 2050. The
under 18's will likely stay constant at ~25%. That means that the government,
just for elderly care and schools (NOT including health care, the military,
roads and harbors and other infrastructure ...) needs half your pay. 50%.
Currently it needs ~25-30% for that. This is totally independent of the actual
spending, it's amount of headcount that needs to go to elderly care.

So in order to simply provide current level care, and without considering
health care for elderly, or increased longevity, your take home pay, just
considering elderly taxes, needs to reduce from ~75% to under 50%. Or, how
this will appear from the perspective of someone who works, your taxes need to
rise by half. Every tax. For California, income tax needs to rise from 40% to
60% (and it's a progressive tax, and this means the income from that tax needs
to rise, so it's not just higher rates for the rich. It's mostly higher rates
for the poor, not because of corruption, but because that's where the money
is), average. Sales tax from 10% to 15%. And so on. A little under half that
tax raise will need to happen in the next president's term (or, God forbid,
Trump's second). Just so we're clear, that's a few years away.

If, as many suggest here, care needs to be increased and more broadly
available ... well that costs more, of course. That means a little under half
the total economic activity in the US needs to be focused exclusively on
taking care of others (again, not including health care, that needs to be
added on top after that).

We all know that current workers are not prepared to pay this. So why are we
wining that "government will not take my elders off of me" ? It cannot do so
...

And the truly scary part is ... compared to Europe, the US is not doing too
bad. Europe is a disaster waiting to happen, and will fail sooner than the US.
Compared to Japan, Europe looks fine. And compared to China, Japan barely has
a problem.

It's weird to realize this, but longer term things are pretty obvious: the US
will open up it's borders like never before (because in the US case, that
might, just might, actually fix things). The EU will ... uh ... I'd say "die",
but politicians never let something die : they go to war. Against whom ? It
won't be very hard at all to start a war with China in a decade, potentially
sooner. It's weird but WW3 between "the EU" (Germany) and China, in 10-15
years would make sense.

~~~
dakna
Germany is not equipped to go to war any time soon. They can't even keep their
current forces armed.

[https://www.dw.com/en/1-in-10-german-military-pilots-lost-
he...](https://www.dw.com/en/1-in-10-german-military-pilots-lost-helicopter-
licenses-for-lack-of-flight-time/a-43646369)

The political climate would need to change a lot for politicians to allow more
military spending and budget cuts elsewhere. The current discussion about
refugees and the unstable situation regarding Trump and the NATO might change
this.

I still agree on Europe having lots of trouble in 10-15 years.

