Filing for bankruptcy is something that can happen to just about anyone. Regardless of your current income or savings, it is possible to encounter financial issues which can adversely affect your finances. Bankruptcy can eliminate years of acquired debts that you are not able to pay off. Listed below are some common reasons as to how people may be faced with the option of declaring bankruptcy.
Lack of Budgeting
No matter what your current salary is, creating and sticking to a budget is the best way to properly manage your finances. However, many people fail to do this. For some, it is a lack of money management skills that prevents them from budgeting effectively. Over spending can also easily create high credit card account balances. It is important to keep in mind that you may encounter a point where you are unable to maintain a steady income.
Bad Investments/Change in the Market
Making a series of bad investments can quickly drain your financial resources. For example, let’s say that you put your money into real estate. If the market takes a turn for the worse, your total net worth could drop significantly in a matter of weeks or months. If you have your money tied up in a certain stocks, they should be monitored regularly to ensure you gain a return on investment.
Costly Medical Bills
Being faced with a medical emergency is case where many can quickly spend more money than expected. Crucial medial surgeries or procedures can be costly, even after insurance coverage. Unexpected medical bills are a common way that some will look to bankruptcy for financial assistance.
Your income or annual salary does not determine your need to file bankruptcy. A large amount of celebrities have looked to bankruptcy as a way to eliminate their outstanding debts. Some of the most recognized celebrity bankruptcies include:
- Donald Trump
- Larry King
- Mike Tyson
- Toni Braxton
- Dionnne Warwick
The reasons why more people are now filing for bankruptcy vary, but it is a helpful solution to many. Ralph Ferro Jr., Esquire can help assess your current financial standing and determine a solution that suits your needs. Whatever you reason for filing for bankruptcy; bankruptcy is not an indication of failure – it is an opportunity to move forward.