Almost half of the senior population pass away with less than ten thousand dollars in tangible assets. That’s according to a four year old study by the National Bureau of Economic Research. At the same time, senior debt is skyrocketing. Just ten years ago is was thought to be unusual for a senior citizen to retire while still having a mortgage or paying off credit cards. But today over twenty percent of those past the age of seventy five still have mortgages that they are paying off — which is four times as many as sixteen years ago. The Federal Reserve says that credit card debt among those seventy years of age and older has gone from ten percent to over twenty five percent today.
Children need to be prepared if their parents die in debt. Here are a few pointers.
If threatened by bill collectors for a deceased parent’s bills, don’t worry. Unless you cosigned on a loan with them, you are under no legal obligation to pay them.
If a parent leaves behind a large group of creditors, they can still make your life miserable even if they can’t collect from you. If this happens, simply refer them to your state’s probate court for all further inquiries. By law, they have to cease and desist hassling you and deal exclusively with the probate court.
If a parent dies apparently insolvent but also appears to have some assets, don’t try to handle it yourself — hire a probate attorney to work through the mess. In the long run you’ll save time and money, as they know exactly how to deal with the intricacies of debtor/creditor laws and the probate system.