Credit Use

• Anyone that decides to file bankruptcy during their retirement years might not have the use of other credit accounts. Some creditors might lower credit limits, making it difficult to use credit cards. Some retirees depend on the use of credit cards. If these accounts are closed or have the credit limits decreased, you will struggle for another source of cash. A limited income could make survival difficult.
  
  

Debt Reduction

• A benefit of filing for bankruptcy is that you will be able to eliminate a lot of your debt and you might be able to survive without new credit. The income you receive might be sufficient to support living expenses. You will live a credit-free life. It will be important to establish a budget at that point.
  
  

Limited Assets

• If you plan on helping grandchildren, your ability to do so will be limited. Chances are you don't have many other assets or resources to fall back on because of the bankruptcy. If Social Security is your only income, it might be some time before you can re-establish your credit. When you file for bankruptcy, you must disclose all of your income and assets. Some assets are exempt and some must be turned over to the trustee and go toward the payment of creditors.
  
  

Vacation and Travel

• Retirement is the time for vacations and traveling. Without credit, you might not be able to rent a car or hotel room when you make your travel plans. Traveling will have to be severely limited. Vacation plans will be restricted as well.
  
  

New Credit

• You might have to rely on friends, family and relatives. When you get ready to re-establish credit, consider getting a secured credit card. These types of cards require you to open a bank account with a deposit of $300 or $500, which also becomes the credit limit on your credit card. Late payments will be taken from your bank account. The rates of interest on secured accounts are very high and there could be an excessive number of fees. Retirement makes it difficult to afford those types of fees.