The Dallas Morning News published a story recently entitled “Retirees Sliding into Debt: Higher Costs of Housing, Medical Care and Utilities Can Overwhelm Budgets.” The story refers to a study by the National Consumer Law Center about seniors turning increasingly using credit cards to cover retirement costs.
The study found that the average credit card debt for consumers 65 to 69 years of age has increased 217 percent over the last decade and is close to $6,000. The NCLC’s study attributes this trend to three factors: (1) seniors’ stagnant or shrinking income; (2) higher expenses for housing, medical care and utilities; and (3) creditor practices that influence seniors to borrow. The study reported seniors average more than $3,500 in out-of-pocket medical costs annually, which is a 45 percent increase over a 10-year period.
This situation can be even more challenging when the senior has Alzheimer’s disease. My mom always enjoyed shopping as a diversion; for a couple of years prior to her diagnosis, she would head to the local linen store or discount clothing store.
In retrospect, I’m sure that Mom’s shopping was her way of finding some comfort so she didn’t have to think about her deteriorating health. However, I didn’t realize exactly how much her shopping, combined with her memory loss, had caused an issue until I went last January to sort through her clothes.
Mom had purchased ten to fifteen of the same item, such as warm-up suits. This happened on many things in her closet. I’m pretty sure Mom went out, saw something she liked, purchased it on credit card, took it home and forgot that she had bought it. So the next time she went out to the same store, she saw the item, still liked it, and bought it again. Her shopping, due to her declining memory, turned into a vicious cycle.
The Morning-News article indicated that this situation is common. The article cited Suzanne Cobb, who supervises the money management program at the Senior Source in Dallas, as saying, “They lose their judgment and become easy prey for telemarketers and anyone else who wants to sell them something. I’ve walked into homes filled with merchandise that the owners don’t even recall ordering.”
As a caregiver, the challenge becomes how to help your loved one keep spending under control. You will have to think creatively about how to deal with this situation. The best solution is to provide the loved one with a cash allowance and remove all credit cards from his or her use. Destroy any credit card offers that come in the mail. And get your loved one’s phone number listed on the “No Call” list so that credit card companies don’t contact him or her to try to push the idea of getting a new credit card.
Published On: February 05, 2007