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Why people go bankrupt

On Behalf of | Jun 25, 2015 | Personal Bankruptcy | 0 comments

Every year, thousands of people in Kentucky file for bankruptcy. For one reason or another, people need debt relief, and this is their only option. But why do so many people face such difficult financial hardships?

One of the most common reasons is medical expenses. According to a Harvard study, these constitute more than 60 percent of all bankruptcies. Bills keep piling up, even for the insured. And when you have medical expenses from a condition that made you unable to work, suddenly you have no way to pay them.

For “shopaholics,” credit card debt can soon become a crushing weight. You try to make your monthly payments, but soon you find there are too many bills and not enough income. Bankruptcy can give you a new start.

Another cause of financial hardship is unemployment. Even when you have savings or an emergency fund, you can soon find yourself out of money after paying monthly bills. And when you can’t find a new job quick enough, bankruptcy soon becomes your only option.

Going through divorce litigation can soon drain your bank account. You have attorney fees, court fees, you have to find a new home… the list is seemingly endless. That child support check may feel like the final nail in the coffin.

The last major reason for bankruptcy is that people don’t (or can’t) plan for the unexpected. Perhaps a natural disaster destroys the house; maybe someone stole your car. For whatever reason, having to replace your assets can destroy your finances.

If you are in need of a fresh financial start, an expert bankruptcy lawyer may be able to help. They can explain the different options available and help you through the process.