The Perfect Storm Leading to Bankruptcies for Thousands of Americans

The Perfect Storm Leading to Bankruptcies for Thousands of Americans

We Are Far From The End of Cripiling Financial Times for So Many Who Need to Cut Ties with Bad Debts and Start Over with Bankruptcy

The current bankruptcy trend is increased filings, with 504,112 bankruptcy case filings in the tracking year ending September 2024, an increase from the previous year’s filings of 433,658 petitions for bankruptcy relief. This increase of 16.25% is significant. Source: U.S. Courts.gov. It shows us that many people in the US economy still suffer the long-term effects of inflation and the impact of economic conditions tied back to the pandemic shutdowns which decimated many small business owners and put even more people out of work in layoffs. Coupled with increased expenses, people experiencing money problems had multiplying strikes against them. The perfect storm leading to bankruptcies for thousands of Americans is something from which to learn and anticipate better days ahead. 

Sick and Tired of Bad Financial Times? Call Joseph Wrobel, Chicago Bankruptcy Lawyer

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A string of choices ends up in a perfect storm of financial distress. Imagine grandma cosigns the grandaughter’s car loan in the following situation. Grandaughter’s college beater car would have gone for a few more years but she lost her agency job due to layoffs and she ended up doing rideshare driving which led to the end of her car. She talked Grandma into cosigning for a new car so she could keep driving and making money. Then the new car had a problem that the grandaughter couldn’t afford to fix, and now she has no income from rideshare driving, and the bank is after grandma who cosigned on the car now repossessed. Grandma fears the bill collectors threatening to sue her. Nobody is better off.

 

These Are the Significant Factors Leading People to Seek the Assistance of Bankruptcy Attorneys to Get a Fresh Financial Start:

  • Inflation

If you had $10,000 in your savings account at the end of 2024, it’s worth less money today because of inflation, decreasing the value of the US dollar. Now you need to access some of your savings to pay for a car repair and the parts and labor cost more money than last year because of inflation and related price increases. The impact makes it feel like the repair is twice the cost it should have been.

  • Loss of Income

Small business owners have to lay off employees when they can’t make payroll and also pay themselves and keep the lights on. Many are still trying to thrive but their sales just haven’t been what they used to be. Many businesses made concessions just to stay in business. Many of us realize how much less we have become used to living with since 2020.

  • High Medical Expenses

Many people who lost their jobs also lost health coverage and are facing personal medical expenses they cannot afford. Some people are going without medical care entirely. Increased out-of-pocket medical expenses and high premium rates and deductibles make it harder and harder for people to keep up as they wait for a better economic experience that never seems to come.

  • Unaffordable Mortgages

Anyone on social media sees all the reels and videos of people pointing blame at the real estate markets and lending industry, as mortgages on increasingly expensive homes, are nearly impossible for many to keep up with. People already stretched, and also absorbing inflated grocery prices on basics like coffee, and eggs, are wondering how they’re going to have a home to make breakfast in if things don’t turn around.

  • Spending Beyond Our Means

The great saying is that what matters more than how much we earn, is how much we can save. But who can save money when prices are so high? There are always ways to cut expenses and live on a reduced budget. Think of people complaining about the price of gas as they spend 20 minutes idling in the car in the drive-through line waiting for $5-10 coffee drinks. Financing new items when we could pay cash for slightly used things here and there, those choices all add up.

  • Lending Money to Loved Ones

Grandma needs her bag of cash and it’s nobody’s business how much is in it. Please be kind to loved ones and don’t loan them money to burn gas in the drive-through on overpriced coffee drinks, or worse yet, a cosigned new vehicle when there are always alternatives. Enabling our loved ones’ status quo does not help them as much as it would help to empower them to take control of their finances. Please do not co-sign for family members, we receive so many questions from people in unnecessary and preventable distress.

 

Chicago Bankruptcy Attorney Joseph Wrobel Gets People Back on Their Feet

Everyone has a line they’re not willing to let creditors cross and for many, that line is wage garnishment. When a bill collector sues and gets a court judgment for an amount of money they claim is owed to them, they can start wage garnishment proceedings and get paid off the top of the individual’s paychecks. Nobody wants that kind of negative attention at work, and many people fear they will be treated differently if it’s discovered they cannot pay their bills.

Nobody needs to feel less than because they got hit by a perfect storm of financial problems and didn’t have a secret trust fund to pull from. We are the only ones who can make ourselves feel less than, and that is a good point to remind ourselves – outside of our immediate families, it’s nobody’s business what we do with our money and we should not allow ourselves to feel less than. It’s time to turn that attitude into a positive direction and do something to make tomorrow easier, get rid of the bad old debt you no longer need to stress over.

 

Our Mission at Joseph Wrobel, LTD, the Chicago Bankruptcy Law Firm, is to Empower People with Education and information to Make the Best Financial Decisions, and Sometimes that Means Filing for Bankruptcy

 

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