Bankruptcy isn’t just caused by excessive shopping. Three of the biggest reasons Americans are filing bankruptcy are medical debt, job loss and unexpected expenses due to an act of nature.
Many Americans mistakenly assume that people who use bankruptcy
lawyers to avoid debts are doing so simply because they’ve had too much
fun with their credit cards. However, avoiding credit card debt is
actually a very small reason that Americans have for filing bankruptcy.
If you’re curious about alternative reasons people are filing
bankruptcy, here are three.
#1 Reason For Filing Bankruptcy: Medical Expenses
Medical
expenses are the top reason Americans are going bankrupt and it’s
expected that nearly 60% of bankruptcies happen because of unavoidable,
overwhelming medical debt. Many people mistakenly believe that it’s only
those without health insurance who have excessive medical debt, and
while the uninsured might be a part of the problem, it isn’t just people
without insurance that see bankruptcies as their only option.
One
catastrophic illness or injury could cost a patient hundreds of
thousands of dollars, which could wipe out a person’s savings account in
just a few weeks. Insurance co-pays, co-insurance costs and high
deductibles, coupled with a long-term healthcare need means that someone
without any additional debt could be struggling to keep up with
payments after they’re healthy again.
#2 Reason For Filing: Job Loss
The
second main reason Americans are struggling to keep with their debt is
the economy. Many people, even those who assumed that they had a steady,
stable job, have been saddled with a job loss. In years past, when the
economy was on an uptake, it might have been easier to find a
replacement job, but now, many people are relying on meager unemployment
benefits in order to stay afloat financially. However, these benefits
don’t last forever, and some people struggle to find a job before the
unemployment benefits stop.
#3 Reason For Filing: Unexpected Expenses Due To Act Of Nature
Yet
another reason people are forced to call bankruptcy lawyers is an act
of nature. From hurricanes, to tornados, to fires, these acts of nature
can cause severe devastation. If you’re not properly insured, you could
be forced to pay to rebuild your life entirely by yourself. One way to
protect yourself is to contact a qualified insurance agent and go over
disaster scenarios for your home and your vehicle. If you’re a renter,
there’s no reason not to have renter’s insurance. This coverage is often
available from the same company as your vehicle insurance and can cost
as little as $5 a month. Also, if you drive a newer car, make sure your
car coverage offers gap coverage. This insurance will cover the
depreciation difference, ensuring you can pay off your car if it’s ever
totaled in an accident.
Most people don’t take bankruptcies
lightly. It’s often a last resort decision and many people agonize over
the decision before deciding to file. However, some of the situations
that lead to filing in the first place, such as a large medical debt, a
job loss and an unexpected expense due to an act of nature are
unavoidable. Before ruling it out
, consider calling bankruptcy lawyers
and get their opinion on your situation.
Article Tags:
Filing Bankruptcy, Bankruptcy Lawyers, Medical Debt, Many People
Source: Free Articles from ArticlesFactory.com