Many companies featured on Money advertise with us. Opinions are our own, but compensation and
in-depth research may determine where and how companies appear. Learn more about how we make money.

Published: Jan 19, 2022 5 min read
Senior man is standing in the kitchen of his home with bills in one hand and a cup of tea in the other
Money; Getty Images

Should you be concerned about your debts in your retirement? The short answer is yes.

If possible, it's best to avoid carrying debt in retirement. Studies have linked credit card debt with increased stress and even physical pain. Meanwhile, older adults without such burdens find it far easier to manage their finances and make ends meet.

According to the Federal Reserve Bank of New York, from 1999 to 2019, debt among Americans over the age of 70 climbed a whopping 543%. A 2021 report by Experian found that the average credit card debt held by baby boomers was $6,230, while the average credit card debt held by the Silent Generation (now ages 76 and up) was $3,821.

Households of people ages 70-plus are more likely than before to have credit card debt, mortgages and even student loans.

Embrace frugality

To make debt payments more manageable, create a budget. List all your essential and non-essential expenses, and don't forget to include your debt payments in the essential category. Compare that list against your monthly income. If you're not bringing in enough to cover your necessities, cut back. You know what to do: pare your television subscriptions, borrow books and DVDs from the library, cook at home and so on. Automate your bill paying so you don't forget and get hit with late fees.

It can be helpful to track your expenses, to see where your money really goes. If you account for every penny, it'll be easier for you to see where to trim the fat in your spending. You can use an app, a spreadsheet or simple ledger. If credit card debt is a problem, shop with cash instead. You don't want to get stuck paying high interest rates that compound when you can't pay off your balance each month.`And avoid shopping altogether when possible: Buy Nothing communities on Facebook can be a great way to acquire what you need at no cost.

Rethink your living situation

Housing is one of the biggest line items in most budgets, so one way to slash your expenses is by lowering your housing costs. That could mean downsizing within your same community or relocating to an area with a lower cost of living. Check out Money's Best Places to Retire for a roundup of attractive, affordable locations. Walkable communities can provide opportunities for exercise and ditching a car. Transportation is another big budget item, so to the extent that you can get rid of gas, insurance and car payments for one of your vehicles, that will free up cash to put toward your debt.

If you'd prefer to stay put, government and other local programs can help eligible older adults pay property taxes or make home repairs. Taking a roommate can also help you stay in your home. Some towns have programs that screen and match potential roommates, like this one in New York City.

Seek professional help

White DIY solutions can work for some, there's no shame in seeking professional help in getting out of debt. Many credit counseling networks offer free credit and budgeting services, but creating a Debt Management Plan (DMP), an option for aggressively paying back creditors at a lower interest rate, usually does cost money. It's important to go with a reputable counseling agency. Here are three well-regarded options.

About The Author: Lyle D. Solomon is a principal attorney for the Oak View Law Group in California, where he specializes in consumer finance. He has also written several articles on financial well-being. Connect with him on LinkedIn or tweet him at @lyle_solomon.

More From Money:

These Free Financial Counseling Services Can Help Crush Your Debt

Best Balance-Transfer Credit Cards of January 2022

Generation Owe: Here's the Average Debt at Every Age