The End of March Madness?
March Madness has ended this year for the NCAA Men’s and Women’s basketball tournaments. But for many individuals, the madness continues long beyond the end of March. Instead of worrying about bracketology during the fun of March Madness, they were caught up in being overwhelmed. Overwhelmed by debt, overwhelmed by creditor calls, collection letters, and the overwhelming fear of the unknown as to what may come next.
Consumer debt is what an individual owes as opposed to what a business or the government owes. Consumer debt comes from many sources, chief among which are credit cards, car loans, and student loans. In January 2018 the total U.S. consumer debt reached a record high of $3.855 trillion. Of this, student loan debt led the increase at $1.491 trillion. Car loans totaled $1.335 trillion and credit card debt topped out at $1.0298 trillion. Maybe with our national (government) debt exceeding $20 trillion, the amount of outstanding consumer debt doesn’t sound like that big a deal.
But when we look around our neighborhoods, cities, states and our country, we never think that we can’t handle our personal consumer debt load. So, what pushes individual consumers into considering bankruptcy? Any of these three major events are enough
• Medical Debt
• Job Loss
• Divorce
Medical debt from a catastrophic illness, such as cancer or an unexpected car accident, can be enormous. Medical expenses are the number one reason people file for bankruptcy accounting for 40% to 60% of all personal bankruptcies in any given year. More than a quarter of U.S. adults struggle to pay their medical debts, and many of these have insurance, whether on their own or through an employer. Rare or severe diseases or injuries can easily result in hundreds of thousands of dollars in medical bills, which in turn can quickly wipe out savings, retirement accounts and home equity.
Job loss is something that can happen without any warning and often occurs after purchasing a new home, car, or after the kids just started college. Whether done by layoff, termination, or resignation, the loss of income can be devastating. Many people live paycheck to paycheck and lack emergency savings from which to draw from in lean times. And using credit cards to make up for lost income can be disastrous.
Divorce or separation makes it difficult for many people to maintain the same lifestyle with only half the income if that. The legal costs alone for a divorce can be enough to force someone to file for bankruptcy. Child support and alimony obligations can strip many of their ability to pay the rest of their bills. And those who fail to pay their support obligations often leave the other utterly destitute.
If you’re struggling with debt caused by any of the above or other reasons and are considering filing either a Chapter 7 or Chapter 13 bankruptcy, an experienced bankruptcy lawyer can help you weigh your options and evaluate your alternatives. Please call 813-308-9045 for a free and confidential consultation. And remember, whatever path you choose, Press on Regardless!
