Did you know that in the U.S., the number of bankruptcies is rising at an alarming rate? In the last two decades, we’ve seen a shocking increase in Americans who cannot manage their debt without help from bankruptcy law. As public platforms increase awareness of bankruptcy statistics, more people are aware of their options.
Shocking Bankruptcy Statistics Paint a Picture of a Nation Struggling with Debt:
- Approximately 1.5 million Americans file bankruptcy each year
- 5% of bankruptcy cases are attributed to reckless spending
- 52 mega bankruptcies were recorded in the first three quarters of 2020 (a record-setting number)
- Well-educated individuals file 20% of U.S. bankruptcies
- 52% of bankruptcy filers are male
What is Leaving So Many Americans Struggling with Debt?
In the United States, general bankruptcy statistics indicate that 62% of personal bankruptcies are filed due to medical expenses, close to ⅔ of all bankruptcies. Interestingly enough, the same study revealed that 72% of bankruptcy filings were for people who held some health insurance coverage. According to the reports, people suffering from a rare disease or serious illness are often left with hundreds of thousands of dollars in medical bills – the type of medical bills that wipe out savings, college funds, and modest family inheritances and leave people with little to no options outside of declaring bankruptcy. Additionally, as technological advances continue to grow exponentially, healthcare costs also increase, leaving medical expenses at an all-time high.
Reckless Spending Accounts for Only 5% of Bankruptcy Filings:
While 26% of Americans between 18 and 64 struggle to pay some form of medical bill, the high percentage of bankruptcies due to medical bills isn’t surprising. However, the low rate of bankruptcies due to reckless spending is astonishing at only 5%. While reckless spending may not be the leading cause of bankruptcy, it is still notable that 5% of bankruptcies are avoidable, mainly because some Americans spend beyond their means intending to file for a discharge of debt. However, it’s important to note that this situation applies to a minimal number of bankruptcy petitioners. The majority of petitioners are seeking assistance for legitimate reasons.
If you need to discuss getting out of debt, or you need to talk about obtaining a discharge of debt through bankruptcy, get in touch with Kenneth C. Rannick, P.C., Tennessee, and Georgia bankruptcy attorney. You are in good hands with Kenneth C. Rannick P.C.