Do you harbor some misconceptions about bankruptcy? Most people do. Some people think that bankruptcy happens when people buy things they don’t intend to pay for, or that people who go bankrupt were living foolishly and now want their problems magically wipe away. The truth about bankruptcy is that most people who file for bankruptcy are honest and hardworking people who have run up against circumstances for which they were not prepared, which raised their debt beyond what their income could manage. What are some common causes?
- Losing a job can lead to bankruptcy. Many people live paycheck to paycheck, without savings that add up to a couple of months of expenses. If a person in that situation loses his or her job, it can be hard to stay on top of debt, because unemployment benefits often will not cover living expenses and monthly bills.
- An accident or a long term disease can mean the loss of income. It may be the primary wage earner in the household who becomes ill, is in an accident, or faces unexpected surgery, and that can cause a huge hit to the household finances. On the other hand, accident or illness that hits another family member can cause the wage earner to have to scale back on working in order to care for his or her loved one. Less money coming in at a time when the expenses of medical care and medications are piling up can be overwhelming to a family’s finances and may cause a person to file for bankruptcy.
- Sometimes bankruptcy is the result of poor financial habits. People fail to prepare a budget to keep their expenses in line with their income, or they neglect to build up savings. Then, when something unexpected happens and it’s necessary to pay for a large unexpected expense or make an emergency purchase, they end up using credit and running up debt.
- Divorce or debt can devastate a family’s finances. If the principal wage earner is suddenly no longer part of the family, the effect on the family finances can be dramatic. Often, the family is unprepared to cope with this kind of situation, and this can result in bankruptcy.
If you’re struggling with debt and need information about debt relief, trust the compassionate, dedicated attorneys at Cutler & Associates to work with you and keep your best interests in mind. A Chicagoland bankruptcy firm, we have clients throughout the Chicago metropolitan area, and work hard to make sure our clients get what they need. Our offices are conveniently scattered throughout the area, with locations in Aurora, Chicago, Hoffman Estates, Lisle, Naperville, Oak Brook, Schaumburg, and Skokie. Contact us through our website, or call (773) 360-5802 for more information.