Bankruptcy is an all-too-familiar topic in today’s financial and economic discussions.

One demographic is dealing with the challenges of bankruptcy as much as any other: the baby boomers. According to an article from Fox Business, baby boomers make up a big proportion of those affected by and dealing with bankruptcy.

The American Bankruptcy Institute’s ABI Journal lists baby boomers between the ages of 45 and 64 making up 42 percent of individuals who filed for bankruptcy protection in 2007.

The number of baby boomers who filed for bankruptcy protection is also on the rise. Between 2002 and 2007, the figures for baby boomers filing for bankruptcy rose by 65 percent. During this time, filings for people younger dropped by 60 percent.

The study’s authors, John Golmant and James Woods, told Fox Business that the rise in older bankruptcy filers has outstripped the general population’s aging.

Bill Kelly of Kelly Financial Services said of the emotional impact of filing for bankruptcy: “I would say that 50 percent of the people realize it’s going to be cathartic and 50 percent think going in it is going to be a shameful process.”

He also, however, made note of the sense of some of accomplishment, or at least progress, that comes with the completion of the chapter 7 bankruptcy process. Specifically as it pertains to get out from under difficult debt in order to once again do business and return to participating in the financial system and process.

“I can tell you by meeting with them,” Kelly said, “after they are done, they are totally different people. Even the credit industry understands, the Visa and MasterCard companies, they understand, they would rather have a rehabilitated debtor they can do business with again some day than have somebody they have to spend hundreds of thousands of dollars chasing in order to keep their books in order.”

The ABI study cites a number of factors that put baby boomers in a position of such prominence in the bankruptcy numbers.

The housing crisis may have much to do with the way things have played out. The quick and significant drop in housing prices left many baby boomers without any home equity. There may also have been a tendency for baby boomers to refinance their mortgages, even when it may not have been the best financial move.

Credit card debt may also play a part in the bankruptcy boom among the baby boomers. Specifically, taking on too much credit card debt. High health care costs for not only themselves, but kids and parents too, as well as the rising cost of education were some other factors.

Some of the phenomenon may also be cultural. Baby boomers, moreso than previous generations, became accustomed to living with some debt, and indulging in luxuries that their parents had passed on.

“No one ever said, ‘no,’” to luxury items like iPhones and cars, said Kelly.

Finally, the crashing of the stock market wiped out a number of 401(k)s, leaving boomers without a lot of room to navigate.

Whatever the cause, the numbers are up. And Kelly stressed that potential bankruptcy filers shouldn’t worry about the social stigma of bankruptcy.

“I would say it has helped more people I know than hurt by a long shot, maybe 10-1,” he said.

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