Elder Americans spend more on credit cards

Demos, a liberal public policy group, conducted s study that polled 1,205 low- and middle-income households, defined as those with 50% to 120% of local median income. The study showed that older Americans with financial difficulties are accumulating their credit card debt faster than other consumer groups as retirement portfolios are being cut down and medical costs are rising.

According to the data obtained during the survey low- and middle-income consumers 65 and older carried $10,235 in average card debt last year, up 26% from 2005. Card debt for all borrowers surveyed rose 3% during that time, to $9,827. The information provided by the Federal Reserve shows that in total revolving debt — mostly on credit cards — grew during much of 2008. Still, reduced spending led to decline in outstanding debt.

Demo’s research reveals that consumers with scanty cash on hands use credit cards only for necessities. Over 50% of families admitted they spent much on their credit cards for medical treatment.