Tips for Dealing with Debt in Retirement

Deborah Thorne knows a thing or two about debt's dangers for older consumers. As an academic, she has studied the issue for decades, and she's the lead author of a recent study documenting a surge in bankruptcy filings among older Americans.

And yet, at the age of 57, Thorne herself is approaching retirement carrying a load of debt. "I'll be 65 before my student loans are paid off, and I did not take out huge student loans," says Thorne, an associate professor of sociology at the University of Idaho. What's more, "I will be going into retirement with a mortgage," she says, a move she believes is "financially foolish."

The debt persists despite Thorne's frugality, and the financial anxiety it generates touches every aspect of her life. She plans to work until age 70, and she teaches extra classes so that she can boost her savings. She drives a 1989 pickup truck and took only a two-day vacation this year. She sticks to a vegetarian diet and exercises "out of fear" of medical bills, she says. "A lot of people are living on the edge," she says, "and we're scared."

For a growing number of retirees, the golden years are awash in red ink. Four in 10 retirees cite paying off debt as a current priority, according to a recent survey by the . Older Americans are increasingly