While many people would like to think that they are immune to the possibility
of ever going bankrupt, the truth is that everyone is susceptible to falling
on hard financial times. There are several unknown factors that can potentially
leave you in financial straits. The following are some of the different
scenarios that make up the leading causes of
bankruptcy in America.
1. Medical Expenses
An unexpected illness or serious injury can be devastating to someone’s
finances. According to a study performed by Harvard University, overwhelming
medical expenses contribute to nearly 62% of all bankruptcies. While many
think that this would only affect the uninsured, this study also revealed
that 78% of those who filed for bankruptcy had some level of health insurance.
Hundreds of thousands of dollars’ worth of medical bills can quickly
pile up, depending on the seriousness of the illness or injury. This can
completely eat up savings accounts and other liquid assets, forcing one
to turn to bankruptcy as their only option for shelter.
2. Job Loss
Losing your job can also be a serious blow. This can happen as a result
of either downsizing, being fired, or resigning. The loss of employment
is oftentimes sudden and without warning, with only a few people having
the luxury of collecting severance pay. If a person does not have an emergency
fund to live off of in the event that their income ceases, their situation
can quickly turn into a financial crisis. Using credit cards to pay bills
and purchase necessities can rapidly rack up debt and ruin a person’s
3. Excessive Spending
Uncontrollable spending can also put you in a deep financial hole. Some
people just have a hard time handling money, drying up their bank accounts
through compulsive shopping, purchasing homes that are outside their financial
means, or living a life of excess. If a person is unable to pay for their
foreclosures, bank repossessions of vehicles, and asset seizures can all result.
Divorce can prove to be an incredibly expensive ordeal to pursue. Many
don’t seem to truly consider the financial implications of a marital
separation. Legal fees, alimony, child support, and asset division can
cause both separating spouses to encounter incredibly harsh monetary consequences.
It is not uncommon for a divorce to lead to a person’s eventual
bankruptcy, as the costs of maintaining two separate households and the
burden of attorney’s fees can prove to be too crushing to keep up with.
Are You in Financial Disarray? Call (817) 285-8017
Despite our best efforts, financial struggles can creep up on us when we
least expect it. If you are in overwhelming debt and are considering filing
for bankruptcy, a Fort Worth bankruptcy attorney from the Pritchard Law
Firm can help you determine the most appropriate option for your situation
and help you take steps toward a financially prosperous future. Having
been helping people for more than 40 years, we are confident that we can
find a legal solution for your monetary struggles.
Request a risk-free case evaluation
or contact our firm
today to get started.