By:
Krista Franks Brock, DSNews.com
As
the Baby Boomer generation heads into retirement, many are plagued with debt,
and mortgage debt is their most common financial hardship, according to a study released Monday by Securian Financial Group, a St. Paul,
Minnesota-based financial services firm.
Nearly
half—49 percent—of current retirees retired with debt. Thirty-eight percent of
current retirees hold at least $50,000 in debt.
Among
those who are near retirement, 67 percent expect to carry mortgage debt with
them into their retirement—the largest debt category cited in the Securian
study. This is up drastically from 30 percent in Securian’s last study
completed in 2009.
“Mortgage
debt is a dark cloud over pre-retirees’ financial futures,” said Michelle Hall,
manager of market research at Securian.
Credit
card debt was the second-highest source of debt among pre-retirees. About 40
percent of pre-retirees expect to have credit card debt when they retire.
The
number of retirees whose debt exceeds their savings and investments is on the
rise, according to the study. Forty-two percent of retired survey respondents
fell into this category, up from 33 percent in 2009.
Of
those headed into retirement, 36 percent expect their debt when they retire to
exceed their savings and investments. Twenty-three percent anticipate their
debt will be “much more” than their savings.
“These
numbers are troubling,” Hall said. “For retirees on fixed incomes, debt
payments are extremely burdensome and become more so as the cost of living
rises.”
Securian
also noted varying attitudes toward debt. A little more than half—53 percent of
survey respondents—said debt is “something to avoid if at all possible.”
However, 19 percent view debt as “normal.”
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