Top 5 Reasons People File for Bankruptcy

December 10, 2015

Top Reasons People File for Bankruptcy

Top Reasons People File for Bankruptcy

Bankruptcy can help people resolve serious debt issues by providing them with a financial fresh start. Although some people may need to pursue bankruptcy because they are not good at managing money, surprisingly, a significant number of bankruptcy cases in the U.S. are unrelated to fiscal irresponsibility.

In other words, people who are careful with money and diligent about trying to manage their debt can and often do end up needing to file for bankruptcy when certain circumstances arise.

Below, we will point out some of the most common reasons for pursuing bankruptcy when fiscal irresponsibility is not a primary factor.

Common Reasons for Filing for Bankruptcy

  1. Medical debt – Being hurt in an accident or developing a new ailment can require emergency and ongoing medical care, the bills for which can start adding up very quickly. In fact, a recent Harvard study revealed that medical debt contributes to more than 60 percent of U.S. bankruptcy filings and that, in nearly 3 in every 4 of these cases, the individual had health care insurance.
  2. Job loss – Being fired or laid off is another common reason people end up needing to file for bankruptcy in the U.S., especially if unemployment persists for a few months and people have little to no savings to fall back on.
  3. Reduced income – Even when people may be able to bounce back from unemployment relatively quickly, a reduced income can end up pushing them into debt, especially if they are not able to or don’t cut back on their expenses/spending.
  4. Divorce – Getting divorced is another common reason people end up in serious debt and need to turn to bankruptcy. In fact, if divorce ends up costing a lot of money, there was a lot of marital debt and/or one party is ordered to pay the other support payments, the money problems after the marriage can start adding up fast.
  5. Sudden, unplanned expenses – Even if your health, job and marriage are stable, vehicles can breakdown, homes can need expensive fixes, and other unplanned expenses can arise. When this happens and there is little to no savings to rely on, again, debt can quickly snowball.

Contact a Colorado Springs Bankruptcy Lawyer at the Law Office of Jon B. Clarke, P.C.

Are you struggling with debt and ready for a financial fresh start? If so, it’s time to contact a trusted Colorado Springs bankruptcy lawyer at the Law Office of Jon B. Clarke, P.C.

Call our firm today at (303) 779-0600 or send us an email using the contact form on this page. We also encourage you to complete our Business or Consumer Debtor Analysis Form so that we can provide you with professional advice that is as specific and helpful as possible.

From our offices based in Denver and Greenwood Village, we provide people throughout Colorado with the highest quality debt relief legal services.

Categories: Bankruptcy, Debt