We offer a comprehensive empirical analysis of the debt holdings of older Americans using panel data from the Health and Retirement Study. The average older American household owes a surprisingly large amount of mortgage and consumer debt, even in their late seventies. We find that despite the existence of Medicare, having an acute health shock causes those who do not have mortgage debt to take it, if they have no insurance and we find that a chronic health shock causes those who have no consumer debt to borrow, unless they are insured. On average having insurance just about covers the costs of either type of shock. For those households that own their own home, widowhood results in a considerable reduction in their mortgage. Increases in home prices result in equity release
